What is execution-only brokerage?

Execution-only is a brokerage model that only involves the execution and reporting of orders handed to them by customers. Execution-only therefore means that ancillary services found in full service brokerages are absent, such as in-house research, or financial advice and planning.

How to choose execution only brokers?

Apart from the educational and other resources made available online, another important factor for traders to consider when looking for Execution Only Brokers is the platform that a Execution Only Brokers offer. Choose Execution Only Brokers that's at the forefront of innovation and generally considered an industry-leader.

What is the difference between executing brokers and clearing brokers?

The difference between executing brokers and clearing brokers is something most investors never even think about. In the example, when you place the order to buy 100 shares, that order goes to the executing broker. They review the order for validity, either personally or electronically, and then send the order to the exchange.

How does a broker execute a trade?

A broker executes a trade by placing a fulfillment order for a specific trade. That order is then sent electronically to a clearinghouse, also called a clearing broker, who makes sure the trade is legal and possible, then performs the trade on the appropriate exchange. What Is the Difference Between Clearing and Execution?