What is Fractional Discretion Order.

A type of order that gives the broker (BATS) discretion to alter the price, up or down, within a specific fractional range in order to guarantee an execution.

Example1:
A customer’s order to buy or sell a security, giving the broker limited discretion as to price. For example, an order to sell 200 shares at $75, 25¢ discretion, informs the broker that the customer would like a price of $75 per share but will accept a price as low as $74.75 per share.

Example2:
An order to a broker to buy or sell a security at a certain price that allows the broker to accept a lower price if the desired price is unavailable. An example of a fractional discretion order is an order to buy 100 shares of Wal-Mart at $47 per share, with a 50-cent discretion. This means that if $47 is not available, the broker may buy Wal-Mart at the best available price up to $47.50.

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