Glossary

Broker

A financial broker is a third-party coordinating the sale of financial securities between parties selling securities and those purchasing them. Brokers are individuals or firms acting as intermediaries between investors and trading exchanges.

Exchanges only accept orders from their members, either individuals or firms. Therefore, traders and investors require exchange members' services to make financial transactions. Brokers get compensated for their services in several ways; commissions, fees or paid directly by the exchange.

What is an interactive broker?

An interactive broker is an online trading broker and provider who allows its clients to open and close positions using a digital platform.

They are brokerage firms people visit online, rather than in physical offices. Online brokers offer lower fees. They also provide clients with facilities to engage in do-it-yourself investment trading.

Search the Academy

Look up the meaning of hundreds of trading terms in our comprehensive glossary.

A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z