A call market is a market in which transactions only take place at specific times or intervals, and the price of goods is determined by the market, rather than the activities of buyers and sellers. This type of market can be less volatile than a so-called “auction market” in which people buy and sell continuously, but it can also be difficult to navigate. As a general rule, this technique is used when trading volume is low and there are very few players involved.
In a call market, people put in requests to buy and sell a commodity, and market analysts look at the requests to find the optimal market clearing price which will satisfy the most number of orders. Once the price has been determined, the transactions take place all at once. While the buyers and sellers have some influence over the market price because they indicate how much they are willing to pay or accept for a tradable commodity, they do not have the final say.
Call markets can be used to trade a wide variety of commodities, and they are utilized all over the world. People who trade in such markets need a different approach from people who work in continuous markets, as a call market requires very different strategies. It's less easy to make mistakes in a call market, because of the reduced volume of trading and the overall reduction of chaos on the market floor, but this doesn't make it impossible to make a poor decision, and it can take more time to counteract bad trades when trades only take place at set times.
In the auction or conventional market, orders are filled as needed, with people buying and selling with the traders who will offer the best prices. As a result, the market value tends to fluctuate wildly, and it can seesaw radically several times over the course of a day as people jockey for the optimal market position. Call markets tend to experience less radical swings, and they can be less stressful to navigate.
Typically, the market clears in a call market at the time that the orders are filled, which is another contrast with auction markets. When the market clears, the supply has precisely met the demand, and no one is looking to sell or buy a commodity. Over time, interest in buying and selling will appear again as people's market positions change.