Principal Orders

AAA

DEFINITION of 'Principal Orders'

A type of order carried out by a broker-dealer which involves the broker-dealer buying or selling for its own account and at its own risk, as opposed to carrying out trades for the brokerage's clients.

INVESTOPEDIA EXPLAINS 'Principal Orders'

When a broker-dealer is acting on its own behalf, as opposed to brokering transactions for its clients, it must properly denote to the exchange that it is doing so. These kinds of transactions are also known as "principal trades".

RELATED TERMS
  1. Execution

    The completion of a buy or sell order for a security. The execution ...
  2. Agent

    1. An individual or firm that places securities transactions ...
  3. Exchange

    A marketplace in which securities, commodities, derivatives and ...
  4. Front Running

    The unethical practice of a broker trading an equity based on ...
  5. Order

    An investor's instructions to a broker or brokerage firm to purchase ...
  6. Principal

    1. The amount borrowed or the amount still owed on a loan, separate ...
Related Articles
  1.  These are the two main types of trades that investors will encounter: principal and agent transactions.
    Investing Basics

    Principal Trading and Agency Trading

    Ever wonder what happens behind the scenes when you buy or sell a stock? Read on and find out!
  2. Options & Futures

    Getting To Know The Stock Exchanges

    Here are the answers to all the questions you have about stock exchanges but are too afraid to ask!
  3. Investing Basics

    Understanding Order Execution

    Find out the various ways in which a broker can fill an order, which can affect costs.
  4. Options & Futures

    Brokers and Online Trading

    How do you find the right broker for your investment needs? Start by reading our broker tutorial.
  5. Brokers

    Key Differences Between M&A Advisors And Business Brokers

    For a buy, sale or partnership for one's business, one needs brokers and advisors to proceed ahead. Here are the key differences between business brokers and M&A advisors.
  6. Trading Strategies

    Not All Online Trading Brokers Are Created Equal

    The online trading broker market is becoming more and more competitive. Small differences between them can add up to big fee savings for you--or losses.
  7. Brokers

    How long does it take a broker to confirm a trade after it is placed?

    Learn about placing trades with a broker and the amount of time required to received confirmation of different types of orders, such as limit and stop-loss.
  8. Trading Systems & Software

    How do you know if a trade placed to a broker is confirmed?

    Learn how to check if trades placed with brokers online or over the telephone have been filled and confirmed. Explore different types of orders.
  9. Steps to pick the right options brokerage account depending on your needs, style of trading, etc. It should be unbiased - This article is mainly for a trader who does not know how to pick a option brokerage account
    Options & Futures

    Pick the Right Brokerage Account for Options Trading

    Follow these steps to pick the right options brokerage account depending on your trading needs and style of trading.
  10. Home & Auto

    What are the differences among a real estate agent, a broker and a realtor?

    Learn how agents, realtors and brokers are often considered the same, but in reality, these real estate positions have different responsibilities and duties.

You May Also Like

Hot Definitions
  1. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  2. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  3. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  4. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  5. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  6. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
Trading Center