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Best Execution

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Definition of 'Best Execution'

The responsibility of brokers to provide the most advantageous order execution for their customers. Best execution requires brokers to get the best price for a trade in the shortest time frame. Basically, it is a precautionary measure placed on brokers by the SEC to ensure that investors' best interests are always served.
Investopedia Says

Investopedia explains 'Best Execution'

Best execution is not just an ethical guideline; it is also the law. To comply with this measure, broker-dealers must report to the SEC quarterly on how customers' orders are routed. Orders can be executed in a number of ways, and the method chosen will affect the investor's net profit or loss on the transaction as well as the broker's revenue.

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