Price Improvement

AAA

DEFINITION of 'Price Improvement'

Attaining a higher bid price, if you are selling a stock, or a lower ask price, if you are buying a stock, than the price quoted at the time your order was placed.

INVESTOPEDIA EXPLAINS 'Price Improvement'

You will often read in brokerage marketing pitches that price improvement is an opportunity and not a guarantee. Although most brokerages purport "fighting for that last 1/16" there is no guarantee of this actually happening.

RELATED TERMS
  1. Boston Options Exchange - BOX

    An all-electronic equity derivatives exchange launched on February ...
  2. Agent

    1. An individual or firm that places securities transactions ...
  3. Full-Service Broker

    A broker that provides a large variety of services to its clients, ...
  4. Order

    An investor's instructions to a broker or brokerage firm to purchase ...
  5. Broker

    1. An individual or firm that charges a fee or commission for ...
  6. Discount Broker

    A stockbroker who carries out buy and sell orders at a reduced ...
Related Articles
  1. Principal Trading and Agency Trading
    Investing Basics

    Principal Trading and Agency Trading

  2. Understanding Order Execution
    Investing Basics

    Understanding Order Execution

  3. War's Influence On Wall Street
    Bonds & Fixed Income

    War's Influence On Wall Street

  4. The Basics Of Outstanding Shares And ...
    Investing Basics

    The Basics Of Outstanding Shares And ...

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center