payment for order flow - Investment & Finance Definition
A payment made by a brokerage firm to its Wall Street counterparts for directing trades to the firm. The practice has been criticized because customers may not get the best available price if their trade is directed at someone who specifically is paying to receive those orders. And the payment usually won’t be passed along to retail customers. The practice has occurred in the past with options exchanges, which have paid brokerage firms to steer orders to their traders.