With Discretion

AAA

DEFINITION of 'With Discretion'

A type of limit order that can be modified by a floor broker according to his or her own judgment, allowing him or her to buy or sell to a set point beyond the bounds of the original order. This trading modifier used along with limit and stop orders allows greater customization and flexibility.

INVESTOPEDIA EXPLAINS 'With Discretion'

An order placed with discretion is often beneficial to the investor because it allows brokers to take into account the momentum and mood of the trading floor and act on it as they see fit. For example, say an investor places an order for 500 shares of ABC with a limit order of $15 and a with discretion modifier. If ABC has fallen to around $15 several times during the day but it seemingly won't get to $15, the broker may use discretion and go ahead buy the shares at $15.05, which is a minimal difference to the investor.

RELATED TERMS
  1. Limit Order

    An order placed with a brokerage to buy or sell a set number ...
  2. Floor Broker (FB)

    An independent member of an exchange who is authorized to execute ...
  3. Market Order

    An order that an investor makes through a broker or brokerage ...
  4. Discretionary Order

    An order giving a broker the ability to decide when to buy/sell ...
  5. Buy

    1. A recommendation to purchase a specific security. A buy rating ...
  6. Sell

    The process of liquidating an asset in exchange for cash. The ...
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. The Basics Of Trading A Stock
    Active Trading Fundamentals

    The Basics Of Trading A Stock

  4. Pinpoint Winning Trade Entries With ...
    Active Trading

    Pinpoint Winning Trade Entries With ...

comments powered by Disqus
Hot Definitions
  1. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  2. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  3. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  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. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  6. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
Trading Center