In a give-up brokered trade, one broker (the "giving up" broker) gives up its commission to another broker (the "receiving" broker) in exchange for the receiving broker's assistance in executing the trade. The giving up broker may do this because it does not have the necessary expertise to execute the trade itself, or because it is trying to build up its relationships with the receiving broker's clients.
The nuances of give-up brokered trades can be complex, and it is important for both the giving up broker and the receiving broker to understand all the implications before entering into such a trade. For example, the giving up broker may be giving up more than just its commission - it may also be giving up some control over the execution of the trade, and it may be exposing itself to additional risks. The receiving broker, meanwhile, may be taking on more responsibility than it is accustomed to, and it may be incurring additional costs.
It is important to carefully consider all of these factors before entering into a give-up brokered trade. Both brokers should have a clear understanding of the trade, the risks involved, and the potential benefits to be gained before proceeding.
What are the different phases in trade settlement?
The different phases in trade settlement are as follows:
1. Pre-trade: This is the phase where traders agree on the terms of a trade, but no money or securities have exchanged hands yet.
2. Trade date: This is the date when the trade is agreed upon and the securities are exchanged.
3. Settlement date: This is the date when the trade is settled and the money is exchanged.
4. Post-trade: This is the phase where the trade is complete and all money and securities have exchanged hands.
What does a clearing broker do?
A clearing broker clears trades for its clients, meaning that it acts as the middleman between buyers and sellers to ensure that trades are executed smoothly. The clearing broker also holds collateral for both parties in the trade and is responsible for ensuring that all trade-related obligations are met. In addition, the clearing broker may provide other services such as trade execution, market data, and research. What does a prime broker do? A prime broker is a firm that provides financial services to hedge funds, including funding, securities lending, and execution and clearing services. Prime brokers also provide other services such as research and market intelligence, and they often act as an intermediary between hedge funds and banks.
What is an AGU agreement?
An AGU agreement is a type of agreement between a broker and a client in which the broker agrees to act as the client's agent in the purchase or sale of securities. The broker agrees to abide by the client's instructions and to use reasonable care and skill in carrying out the client's orders.
When should you stop trading?
When should you stop trading?
The answer to this question depends on a number of factors, including your goals, your risk tolerance, your trading strategy, and your performance.
If you are not achieving your trading goals, or if your performance is not meeting your expectations, then it may be time to stop trading.
If you are uncomfortable with the level of risk you are taking, or if your trading strategy is not working as planned, then you may also want to stop trading.
Ultimately, the decision to stop trading should be based on your own personal circumstances and goals. If you are not achieving your goals, or if you are not comfortable with the risks you are taking, then it may be time to stop trading.