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. What's the difference between a market ...
    Active Trading Fundamentals

    What's the difference between a market ...

comments powered by Disqus
Hot Definitions
  1. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  2. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  3. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  4. 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 ...
  5. 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 ...
  6. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
Trading Center