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This refers to a large financial institution that offers services to large institutional clients or hedge funds. It is possible for a firm to have more than one prime broker. Importantly, the firm is not obligated to all of its business through the prime broker. The prime broker offers a variety of services which includes but is not limited to execution of trades, settlement, financing and custody.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
A broker-dealer on an exchange who maintains records and provides brokering services, including leveraged transactions, for other broker-dealers, money managers, hedge funds, and other major investors that trade on the same exchange.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
The broker-dealer who maintains a record of the orders executed by several broker-dealers for a particular institutional or professional trader.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.