What commitment does a broker-dealer have when maintaining a firm market in a stock?

Maintaining a firm market in a stock means that a broker-dealer commits to providing liquidity in that stock by being ready to buy or sell shares at their quoted prices. This is crucial for maintaining an orderly market, especially for less liquid securities where price stability might be at risk. By agreeing to buy or sell normal trading units at the quoted prices, the broker-dealer ensures that there’s a consistent avenue for executing trades, which helps investors transact without significant delays or price discrepancies. This function enhances market efficiency and investor confidence, as market participants know they can rely on the broker-dealer to facilitate trades at stable prices.

The other options relate to aspects of market activity but do not capture the specific obligation of maintaining a firm market. Insights about the company and continuously updating clients focus more on information sharing rather than trade execution, while being sharp with investment strategies pertains to overall financial management rather than the specific role of a broker-dealer in providing market support.