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Broker

• A broker brings buyers and sellers together for a commission paid by the initiator of the transaction or by both sides; he does not position. In the money market, brokers are active in markets in which banks buy and sell money and in interdealer markets.

• (1) An individual or firm that charges a fee or commission for executing buy and sell orders submitted by another individual or firm. (2) The role of a firm when it acts as an agent for a customer and charges the customer a commission for its services. See also: Broker-Dealer.

• An individual who is paid a commission for executing customer orders. Either a floor broker who executes orders on the floor of the exchange, or an upstairs broker who handles retail customers and their orders.

• Is the party who acts as an agent for his customer. The broker receives a commission as compensation. This person is also known as an AE, AP, IE, RR, or registered customer support person. Brokers are required to be licensed according to product lines and states when required.

• A broker brings buyers and sellers together for a transaction for which the broker receives a commission. Broker generally does not hold inventory or make a market for securities.

 
 Embedded terms in definition
 Active
Ae
Agent
Ap
Buy
Commission
Dealer market
Exchange
Firm
Floor broker
Floor
Ie
In the money
Inventory
Its
Make a market
Market
Money market
Position
Retail
Rr
Securities
Sell
Support
The exchange
 
 Referenced Terms
 Account executive: Is the party who acts as an agent for his customer. The Broker receives a commission as compensation. This person may also participate in spreads or other fees which generate revenue for the firm. This person is also known as an Associated Person (AP), Investment Executive (IE), Registered Representative (RR), Registered Customer Support Person or Securities Salesman. Brokers are required to be licensed according to product lines and states when required.

 Agency basis: A means of compensating the Broker of a program trade solely on the basis of commissionestablished through bids submitted by various brokerage firms. Agency incentive arrangement. A means of compensating the broker of a program trade using benchmark prices for issues to be traded in determiningcommissions or fees.

 Agent: The decision-maker in a principal-agent relationship.Is a party who acts on the behalf of another. This occurs when a Broker executes a trade for the benefit of the customer. Here, the broker receives a commission. This compares to a dealer transaction. See Broker-Dealer.A firm that executes orders for or otherwise acts on behalf of another (the principal) and is subject to its control and authority. The agent may receive a fee or commission.

 All or none: Requirement that none of an order be executed unless all of it can be executed at the specified price.Requirement that none of an order be executed unless all of it can be executed at the specified price.AON. Is also called All or Nothing. The order must be completed in its entirety or not at all. Here, there are no partial fills.Abbreviated AON. Used on a buy or sell order to instruct the Broker to fill the order entirely or fill none at all.

 Blind broker: A Broker who acts as principal and does not give up names to either side of a brokered trade. Blind brokering of securities is common, whereas blind brokering of Fed funds and Euro time deposits would be infeasible.

 
 Related Terms
 Blind broker
Broker dealer
Broker loan rate
Carrying broker
Commission broker
Discount broker
Floor broker

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