Amount subtracted from the selling price, when a customer sells securities to a dealer in the Over The Counter (OTC) market. Had the securities been purchased from the dealer, the customer would have paid a markup, or an amount added to the purchase price. The National Association of Securities Dealers (NASD) Rules of Fair Practice established 5% as a reasonable guideline in markups and markdowns, though many factors enter into the question of fairness, and exceptions are common.