markdown business definition
- A reduction from the original selling price. For example, retail clothing stores frequently attempt to decrease inventory by offering markdowns on seasonal merchandise.
- A decrease in a security price made by a dealer because of changing market conditions. For example, a bond trader may take a markdown in long-term bonds held in inventory when market interest rates rise. Compare markup 2.
- The difference between the price paid by a dealer to a retail customer and the price at which the dealer can sell the same security to a market maker. Compare markup 4.
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