      The trades of the specialists on the NYSE are crucial to the existenceof the Exchange as a "dealer market." The purpose of the specialists,according to the Exchange, is to keep a fair and orderly market in thestocks assigned to them. The necessity for the specialist to be involved inthe trading, however, varies greatly from stock to stock. In a recentstudy19 it was shown that in certain stocks (seven percent of the sampledstocks) the specialist participation rate (the ratio of specialist sharepurchases and sales to total reported share volume) exceeds 60 percent.These stocks essentially trade in "dealer markets," with the specialisttaking the opposite side of virtually all transactions. At the otherextreme, the study found that in certain stocks (17 percent of the sampledstocks), the specialist participation rate in trades is less than 10percent. These stocks trade in what approximates a pure "auction market"where investors trade with one another with minimal specialist dealertrading. The study also found that specialists participate less in largetransactions, possibly because many large transactions reach the floorafter upstairs trading desks have had the opportunity to solicitcounterparty interest.