“Jobber” is an informal term used to describe market makers at the London Stock Exchange prior to mid-1980s. Jobbers, sometimes referred to as “stockjobbers,” acted as market makers (MMs). They had the shares on their books, and created market liquidity through buying and selling securities and making matching investors buying and selling orders through brokers which were not permitted to create markets.
The word “jobber” can also be used to refer to a small-scale middleman or wholesaler in the retail trade of goods.
Understanding Jobbers
There is little information about the activities of jobbers since they had no records. However, at the beginning of the nineteenth century London was home to hundreds of companies that were hiring. Employment numbers of jobbers decreased dramatically during the 20th century, until they ended up being inactive on October 1, 1986. In October 1986, it was that the financial ” Big Bang” was observed, which marked a significant change in the operation of the London Stock Exchange that took place. The London Stock Exchange’s finance sector was suddenly deregulated. fixed commissions was replaced with negotiations for commissions, and the use of electronic trading was made available. 1
Jobbers did not keep any records of their activities, and no journalists or other observers kept any precise accountings of their activities. Oral histories of banksand brokerage firms, and other companies are and will remain the basis for any record of the past that pertains the job market. 2
The Centre for Metropolitan History has created an archive of interviews with former jobbers that serve as a record for the last 50 years of a distinct element of the financial history of London.
Special Takes into Account
The jobber system developed into a recognizable modern structure during the the 19th century as the variety of securities expanded. The majority of the participants from the London Stock Exchange began to focus on making an ongoing market for one of the top varieties in these kinds of security.
It was the distinct of these marketmakers or jobbers, and brokers who handled their clients on behalf of the general public was clearly defined, however it was founded on tradition and custom until 1909, when a single capability was officially incorporated into the London Stock Exchange rules. In 1914, more than 600 jobbing companies existed and a lot of jobsbing companies run by one person. 2
These numbers gradually declined because the public investor overtook the private and the size of capital needed for jobbing grew drastically. On the day of “Big Bang,”” there were just five major companies that employed workers in the floors of the London Stock Exchange, though the decline in numbers didn’t necessarily indicate an eroding of the marketability of this system. 3
What is the origin of Stockjobbing?
Stockjobbing, also known as the professional trading of stocks through an exchange is a practice that began in the 1690s, following the Great Britain’s Financial Revolution. 3 The outcome of these reforms in finance was the creation of joint-stock companies that allowed shares to be traded and bought at a price that was flexible. The result was the development of securities exchanges as well as their creation of “jobbers” to ease trading of these stock shares. 4
What happened when Jobbers Vanish?
Stockjobbers were officially removed from British exchanges in the stock exchanges in October of 1986, which coincided with the sudden reduction in the regulation of market conditions in the U.K. implemented by the then-Prime Secretary Margaret Thatcher. This resulted in stockjobbers not required anymore to facilitate stock trading and simultaneously efforts to implement screen-based, electronic trading were put in place, leading to their demise. 1
What was the difference between a Broker and a Jobber?
Stockjobbers functioned as an exchange maker in stocks by buying and selling shares on behalf of their own accounts as well as earning income through an price-to-bid spread. A broker is a broker who facilitates the purchase of securities through behalf of customers which earns them commissions. A broker might have purchased or sold securities from a jobber to their customers.
