Block Positioner

DEFINITION of 'Block Positioner'

A securities dealer who will take a long or short position in order to accommodate a seller or buyer of a large block of securities. The dealer takes on the risk of the securities in order to help clear the trade for the seller. Block positioners aim to unload the position quickly, and typically hedge their risk with options or by selling the securities short.

BREAKING DOWN 'Block Positioner'

Block positioners can take on considerable risk in exchange for the profits they seek. Any firm involved in block positioning must register with the Securities and Exchange Commission and the New York Stock Exchange, if it is a member firm. Under Rule 15c3-1 for market makers, block positioners must have minimum capital of $1 million and meet other conditions while unloading the securities block.

RELATED TERMS
  1. Dealer

    A person or firm in the business of buying and selling securities ...
  2. Electronic Communication Network ...

    An electronic system that attempts to eliminate the role of a ...
  3. Block

    A large amount of the same security bought or sold by institutional ...
  4. Market Maker

    A broker-dealer firm that accepts the risk of holding a certain ...
  5. Block Trade

    An order or trade submitted for sale or purchase of a large quantity ...
  6. Warrant

    A derivative that confers the right, but not the obligation, ...
Related Articles
  1. Investing Basics

    The Roles Of Traders And Investors In The Marketplace

    Discover how these two groups work together to keep the market functioning properly.
  2. Mutual Funds & ETFs

    The Pros And Cons Of Institutional Ownership

    These big players can both create and destroy value for shareholders.
  3. Retirement

    Roth IRAs Tutorial

    This comprehensive guide goes through what a Roth IRA is and how to set one up, contribute to it and withdraw from it.
  4. Economics

    The History of Stock Exchanges

    Stock exchanges began with countries who sailed east in the 1600s, braving pirates and bad weather to find goods they could trade back home.
  5. Options & Futures

    What Does Quadruple Witching Mean?

    In a financial context, quadruple witching refers to the day on which contracts for stock index futures, index options, and single stock futures expire.
  6. Options & Futures

    4 Equity Derivatives And How They Work

    Equity derivatives offer retail investors opportunities to benefit from an underlying security without owning the security itself.
  7. Options & Futures

    Five Advantages of Futures Over Options

    Futures have a number of advantages over options such as fixed upfront trading costs, lack of time decay and liquidity.
  8. Term

    What is Pegging?

    Pegging refers to the practice of fixing one country's currency to that of another country. It also describes a practice in which investors avoid purchasing security shares underlying a put option.
  9. Home & Auto

    Understanding Pre-Qualification Vs. Pre-Approval

    Contrary to popular belief, being pre-qualified for a mortgage doesn’t mean you’re pre-approved for a home loan.
  10. Investing Basics

    An Introduction To Structured Products

    Structured products take a traditional security and replace its usual payment features with a non-traditional payoff.
RELATED FAQS
  1. A company I recently looked up showed institutional holdings of more than 100%. How ...

    It is obviously not technically possible for any shareholder or category of shareholder to hold more than 100% of a company's ... Read Full Answer >>
  2. What's the difference between institutional and non-institutional investors?

    There are a number of differences between institutional investors and non-institutional investors. If you are considering ... Read Full Answer >>
  3. What is a derivative?

    A derivative is a contract between two or more parties whose value is based on an agreed-upon underlying financial asset, ... Read Full Answer >>
  4. What is after-hours trading? Am I able to trade at this time?

    After-hours trading (AHT) refers to the buying and selling of securities on major exchanges outside of specified regular ... Read Full Answer >>
  5. How do hedge funds use equity options?

    With the growth in the size and number of hedge funds over the past decade, the interest in how these funds go about generating ... Read Full Answer >>
  6. Can mutual funds invest in options and futures? (RYMBX, GATEX)

    Mutual funds invest in not only stocks and fixed-income securities but also options and futures. There exists a separate ... Read Full Answer >>
Hot Definitions
  1. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  2. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
  3. Presidential Election Cycle (Theory)

    A theory developed by Yale Hirsch that states that U.S. stock markets are weakest in the year following the election of a ...
  4. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
  5. Flight To Quality

    The action of investors moving their capital away from riskier investments to the safest possible investment vehicles. This ...
Trading Center