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Definition of 'Direct-Access Broker'
A stockbroker that concentrates on speed and order execution - unlike a full-service broker that focuses on research and advice. Direct-access brokers usually use complicated computer software that allows clients to trade directly with an exchange or with other individuals via electronic communication networks (ECN).
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Investopedia explains 'Direct-Access Broker'
Direct-access brokers have become very popular among active traders because of their speedy transaction times, but other services such as streaming quotes, interactive charts, Level II Nasdaq quotes and other real-time features have also contributed to this success. These brokers have cut down their costs and increased efficiency by eliminating the role of the third party, which in turn allows them to charge a lower commission than traditional brokers.
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How do you find the right broker for your investment needs? Start by reading our broker tutorial.
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Learn about the systems that run the market. Topics include market makers, specialists, SuperDOT, ECNs, SOES, Level I, II, and III Access, and more.
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Find out the various ways in which a broker can fill an order, which can affect costs.
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