Understanding Stock Borrows

Understanding Stock Borrows

Introduction to Stock Borrows Stock borrows are the acts in which a brokerage loans out shares of a stock to an investor. Most often, traders borrow stocks in order to sell them short, buying additional shares at a lower price to return the borrowed stock. Just as in...
What are Clearing Firms and Why Do They Matter?

What are Clearing Firms and Why Do They Matter?

Introduction Clearing firms, also known as clearing corporations or clearing houses, handle the back-end operations behind making securities trades actually happen once a trade is submitted. Essentially, clearing firms make sure that your money and stocks make it to...
Margin Trading for Beginners

Margin Trading for Beginners

What is Margin Trading? Margin trading is trading using money borrowed from your broker. Effectively, it can be thought of as taking out a loan from your broker. Although buying and selling on margin does not provide leverage in and of itself, it can be used as a form...
Order Routing And How It Affects Your Trading

Order Routing And How It Affects Your Trading

As traders, we are often focused on finding good setups and placing trades accordingly. Many traders don’t put too much thought into what happens after they press the “Buy” or “Sell” button. That said, order routing can have an impact on your executions speed, fills,...
Benefits of Direct Access Brokers

Benefits of Direct Access Brokers

What is a Direct Access Broker? A direct access broker is a specialized brokerage that allows the user to directly route their orders to specific electronic communication networks (ECN), market makers and exchanges. The broker provides advanced trading platforms that...