Approved Participants


DEFINITION of 'Approved Participants'

Institutional investors who are allowed direct access to an exchange's trading environment. Approved participant status usually affords trade execution cost savings and the right to install trading terminals in client offices.

BREAKING DOWN 'Approved Participants'

Eligibility of approved participants is determined by specific criteria outlined by the respective exchange. For example, the Boston Options Exchange requires a potential approved participant to be a U.S.-based entity, a member of a designated options examining authority and have a minimum $200,000 in net equity.

Approved participants are able to take part in prearranged transactions (trades where the two parties agree on the transaction's terms prior to placing orders in the electronic trading system) such as block trades.
  1. Exchange

    A marketplace in which securities, commodities, derivatives and ...
  2. Institutional Investor

    A non-bank person or organization that trades securities in large ...
  3. Block Trade

    An order or trade submitted for sale or purchase of a large quantity ...
  4. Crude Oil

    Crude oil is a naturally occurring, unrefined petroleum product ...
  5. Leg

    A leg is one component of a derivatives trading strategy, in ...
  6. Grant

    The issuance of an award, such as a stock option, to key employees ...
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