Give Up

AAA

DEFINITION of 'Give Up'

A procedure in securities or commodities trading where the executing broker places a trade on behalf of another broker as if he/she actually executed the trade. This is usually done because a broker is too busy to place a trade for a client and asks another broker to place the trade for him/her. On the record books, the trade will not show the executing broker's information, but the broker to whom the client belongs. Thus, the broker of the client and the broker on the other side of the trade will receive the commission, while the executing trader will get nothing. This is a grey area of law governing reimbursement of brokers for services (e.g. research).

INVESTOPEDIA EXPLAINS 'Give Up'

Pay close attention, here's how it works. Broker X gets a buy order from a client but is too busy to place the trade, so he asks Floor Broker Y, who isn't as busy, to place the order for him/her. Broker Y then buys the stock from Broker Z on behalf of Broker X's client. However, although Floor Broker Y places the trade, he must "give up" the transaction and record it as if Broker X placed the trade since the client belongs to him/her.  Thus, the transaction is recorded as if X & Z made the trade, even though Floor Broker Y executed the trade.

RELATED TERMS
  1. Dealer

    A person or firm in the business of buying and selling securities ...
  2. Agent

    1. An individual or firm that places securities transactions ...
  3. Front Running

    The unethical practice of a broker trading an equity based on ...
  4. Full-Service Broker

    A broker that provides a large variety of services to its clients, ...
  5. Two Dollar Broker

    A floor broker who executes orders for other brokers who cannot ...
  6. Broker-Dealer

    A person or firm in the business of buying and selling securities, ...
Related Articles
  1. Brokers and Online Trading
    Options & Futures

    Brokers and Online Trading

  2. Pick the Right Brokerage Account for ...
    Options & Futures

    Pick the Right Brokerage Account for ...

  3. What are the differences among a real ...
    Home & Auto

    What are the differences among a real ...

  4. Using Money Orders
    Budgeting

    Using Money Orders

Hot Definitions
  1. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  2. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  3. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  4. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  5. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  6. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
Trading Center