Local

AAA

DEFINITION of 'Local'

Traders on future exchanges who may fill public orders occasionally, but will predominantly buy and sell for their own personal accounts. Locals act as floor traders on exchanges, however the key difference between locals and actual floor traders is that locals typically are not members of the exchange they wish to trade on, which is why they are classified in another category of floor trader.

INVESTOPEDIA EXPLAINS 'Local'

Since locals often are not members of the exchanges, which they wish to trade on for their own personal benefit, in most cases a local will actually lease the floor "space" from a member trader who otherwise would not be required to trade on the floor at that time. Such an arrangement offers benefits to both parties, as locals are able to trade for proprietary purposes while members can collect leasing premiums for use of their floor privileges.

RELATED TERMS
  1. Floor Trader - FT

    An exchange member who executes transactions from the floor of ...
  2. Futures Market

    An auction market in which participants buy and sell commodity/future ...
  3. Member

    1. In the most general context, a brokerage firm (or broker) ...
  4. Exchange

    A marketplace in which securities, commodities, derivatives and ...
  5. Floor

    The lowest acceptable limit as restricted by controlling parties. ...
  6. Cash-And-Carry Trade

    A trading strategy in which an investor buys a long position ...
Related Articles
  1. Principal Trading and Agency Trading
    Investing Basics

    Principal Trading and Agency Trading

  2. Getting To Know The Stock Exchanges
    Options & Futures

    Getting To Know The Stock Exchanges

  3. A Look At Primary And Secondary Markets
    Investing Basics

    A Look At Primary And Secondary Markets

  4. Curious About Stock Index Futures? Read ...
    Options & Futures

    Curious About Stock Index Futures? Read ...

comments powered by Disqus
Hot Definitions
  1. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  2. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  3. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  4. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
  5. Days Payable Outstanding - DPO

    A company's average payable period. Calculated as: ending accounts payable / (cost of sales/number of days).
  6. Net Sales

    The amount of sales generated by a company after the deduction of returns, allowances for damaged or missing goods and any ...
Trading Center