Carrying Broker

AAA

DEFINITION of 'Carrying Broker'

A commodities or securities broker who provides back office functions such as clearing, settlement and custodial services to other brokers. The carrying broker therefore enables other brokers, known as introducing brokers, to provide full service to their clients without incurring the huge start-up and maintenance costs of running a back office. Introducing broker/carrying broker relationships have existed in the United States since the mid-1970s.

INVESTOPEDIA EXPLAINS 'Carrying Broker'

The benefits of using a carrying broker include cost efficiencies, economies of scale and risk mitigation. It also allows the introducing broker to focus on its core competencies, such as portfolio management, client relationship management and marketing of products and services.
Carrying brokers also provide additional services, such as maintaining records of client transactions and preparing and distributing client statements and confirmations. Some carrying brokers even provide financing for client margin accounts.

RELATED TERMS
  1. Associated Person

    The name given to participants within the futures market that ...
  2. Cost Of Tender

    The total charges associated with the delivery and certification ...
  3. Current Delivery

    A type of futures contract that requires the delivery of the ...
  4. Introducing Broker - IB

    A futures broker who has a direct relationship with a client, ...
  5. Futures Contract

    A contractual agreement, generally made on the trading floor ...
  6. Broker

    1. An individual or firm that charges a fee or commission for ...
Related Articles
  1. Investing Basics

    Understanding Order Execution

    Find out the various ways in which a broker can fill an order, which can affect costs.
  2. Brokers

    Uncovering The Securities Firm

    Learn about the various departments of a securities firm and the professionals who make it work.
  3. Personal Finance

    4 Dishonest Broker Tactics And How To Avoid Them

    Protecting yourself from unscrupulous practices means knowing how to spot them.
  4. Options & Futures

    Brokers and Online Trading

    How do you find the right broker for your investment needs? Start by reading our broker tutorial.
  5. Insurance

    Futures Fundamentals

    For those who are new to futures but want a solid understanding of them, this tutorial explains what futures contracts are, how they work and why investors use them.
  6. Options & Futures

    What are the differences between divergence and convergence?

    Find out what technical analysts mean when they talk about a market experiencing divergence or convergence and how they affect trading strategies.
  7. What to include – and leave out – to create the kind of resume that will get you the interview that lands you the job.
    Personal Finance

    Resume Strategies To Get That Finance Job

    What to include – and leave out – to create the kind of resume that will get you the interview that lands you the job.
  8. Options & Futures

    Futures Quotes Explained The "Easy" Way

    If there’s a security whose price fluctuates, there can theoretically be a futures marketplace for it.
  9. Professionals

    What's the average salary of a bank teller?

    Read this article to find out more about average bank teller salaries, median hourly wage rates and potential future career prospects.
  10. Professionals

    What's the average salary of a business operations manager?

    Read about the average yearly salary of business operations managers, and find out which locations and industries offer the best pay for these professionals.

You May Also Like

Hot Definitions
  1. Christmas Island Dollar

    The former currency of Christmas Island, an Australian island in the Indian Ocean that was discovered on December 25, 1643. ...
  2. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations ...
  3. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  4. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  5. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  6. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
Trading Center