SS 16: Order driven markets

LOS 45c: Under the category of order driven markets, there are the following subclasses: - Order driven markets and electronic crossing networks: Do not provide price discovery - Auction and automated auction markets: Do provide price discovery I dont get the concept of price discovery, and how or why the former two examples do not and the latter do provide price discovery. Can someone please elaborate? Thanks, OA

price discovery mean that supply/demand determines the price. for example if you to want to buy a share of citi. and you get quoted 4.0 @ 4.01 you can lift those and get done at 4.01. this is price discovery. on an ecn you just place a buy order and at a certain time it will get crossed if there is enoungh size. so you dont know what price you will get done at and you dont know if you will even get a fill. this mens no price discovery. i dont know why i used citi but i am working here and having a bad day,903856,904012#msg-904012 This might help with the ECN