Agency Trade

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Agency Trade

A trade that a broker makes for a client in which the broker initiates the order. Only brokers managing discretionary accounts may make agency trades because, otherwise, they do not have the authority to execute orders without the client's explicit authorization.
References in periodicals archive ?
The firm said that the solution supports the bank's cash equity business for principal and agency trades conducted on the Australia Securities Exchange (ASX) and CHI-X Markets.
NASD found that the firms violated NASD rules when they received unusually high commissions from certain customers on listed agency trades -- without inquiry and within one day of allocating shares in "hot" IPOs to those same customers.
Each of the firms accepted very high commission payments for executing institutional-sized agency trades in liquid listed securities.
Within one day of receiving these shares, this customer paid Deutsche Bank $1 per share to execute five listed agency trades and 40 cents per share for the execution of five additional listed agency trades.