Trading Floor Broker Definition

The area of a stock exchange or financial market where dealers work.

Trading floor broker definition. Securities are traded double auction style on an exchange trading floor. Stock exchange member who executes buy sell orders on behalf of his or her customers on the floor of the exchange. Trading floors are found in the buildings of various exchanges such as the new york stock exchange and the chicago board of trade. They are independent members of the exchanges on which they trade and they work from physical trading floors.

The floor broker receives an order via teletype machine from his firm s trading department and then proceeds to the appropriate trading post on the exchange floor. That means the prices are set by competitive bidding between brokers representing buyers and brokers representing sellers following a series of clearly. Floor brokers at a securities or commodities exchange handle client orders to buy or sell through a process known as a double action auction in which brokers bid against each other to secure the best price. A floor broker also known as a pit broker is an independent broker who executes orders on the floor of a stock or commodity exchange on behalf of clients that can include banks or brokerages.

A floor broker is an independent member of an exchange who can act as a broker for other members who become overloaded with orders as an agent on the floor of the exchange. See also floor trader. Floor brokers execute trades on behalf of institutional and high net worth clients. It can be defined as that segment of the market where the trading activities by the dealers in the financial instruments like equities debt derivatives bonds futures take place they take place in various.

A trading room gathers traders operating on financial markets the trading room is also often called the front office the terms dealing room and trading floor are also used the latter being inspired from that of an open outcry stock exchange as open outcry is gradually replaced by electronic trading the trading room becomes the only remaining place that is emblematic of the financial market. There he joins other brokers and the specialist in the. Trading floor is a place where traders buy and sell fixed income securities shares commodities foreign exchange options etc. They can act as a back up if the market is overwhelmed by orders.