Introducing Broker - IB

What is an 'Introducing Broker - IB'

An introducing broker (IB) is a futures broker who has a direct relationship with a client, but delegates the work of the floor operation and trade execution to another futures merchant. The merchant firm is usually a close partner of the IB.

BREAKING DOWN 'Introducing Broker - IB'

This is done to increase efficiency and lower the work load for futures brokers. It allows the IB to focus on the client while the futures merchant focuses on trading floor operations.

RELATED TERMS
  1. Omnibus Account

    An account between two futures merchants (brokers). It involves ...
  2. Merchant Agreement

    A contract between a business and a credit card service provider.
  3. Floor Limit

    A purchase amount over which further authorization is needed ...
  4. Futures Commission Merchant - FCM

    A merchant involved in the solicitation or acceptance of commodity ...
  5. Merchant Account

    A type of business bank account that allows a business to accept ...
  6. Floor Broker (FB)

    An independent member of an exchange who is authorized to execute ...
Related Articles
  1. Professionals

    Guaranteed And Independent IBs

    Guaranteed And Independent IBs
  2. Forex Education

    Forex Broker Guide: Advanced Features

    Introducing BrokersAn introducing broker (IB) is an individual or organization that solicits and/or accepts orders to buy or sell futures contracts, forex, or commodity options, but that does ...
  3. Economics

    What Does a Merchant Bank Do?

    A merchant bank is a financial institution that performs underwriting, loan services, financial advising and fund raising services to large corporations.
  4. Professionals

    Net Capital Requirements

    Net Capital Requirements
  5. Professionals

    General Regulations

    General Regulations
  6. Trading Systems & Software

    Brokerage Reviews: TradeStation Vs. Interactive Brokers

    These are among the most sophisticated brokers in the industry in terms of investment offerings, market access and technology.
  7. Forex Education

    Forex Broker Guide: Broker Basics

    RegulationA reputable forex broker should have rules, programs or services to protect the integrity of the market. They should protect the public from fraud, manipulation and abusive practices ...
  8. Professionals

    General Futures Terminology

    General Futures Terminology
  9. Investing Basics

    How To Choose The Right Online Trading Broker

    The online broker market is becoming more competitive, but differences exist in services that can help traders choose the broker that’s right for them.
  10. Investing Basics

    Picking Your First Broker

    If you're a rookie investor, your first big investment decision should be an informed one.
RELATED FAQS
  1. What is the difference between investment banks and merchant banks?

    Merchant banks and investment banks, in their purest forms, are different kinds of financial institutions that perform different ... Read Answer >>
  2. How does an insurance broker make money?

    Discover how an insurance broker makes money. Insurance brokers are important in helping people find the right insurance ... Read Answer >>
  3. I'm new to this. Can I sell or buy stock by myself?

    In order to buy stocks, you need the assistance of a stock broker since you cannot just phone up a company and ask to buy ... Read Answer >>
  4. Does a broker always have to buy a stock if I want to sell it?

    There are certain times when a broker must purchase the stock that you are selling. For example, if the broker is a market ... Read Answer >>
  5. There are so many stockbrokers out there. How do I go about choosing the best one ...

    If you decide that you have the knowledge and experience to take on stock investing, or if you feel you would like to give ... Read Answer >>
  6. Does agency theory apply to brokers and clients?

    Learn how the existence of incentives that encourage moral hazard impacts broker-client relationships. Understand how agency ... Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center