No Dealing Desk Knowledge Base

No Dealing Desk (NDD)

A broker execution model that routes client orders directly to liquidity providers without manual intervention or dealing desk involvement, eliminating inherent conflicts of interest.

Also: NDD, No Dealing Desk

A-Book

An execution model where the broker passes client orders directly to external liquidity providers without taking the opposite side of the trade.

Also: Straight-Through Processing, STP

B-Book

An execution model where the broker acts as counterparty to the client, internalizing the order rather than routing it to an external liquidity provider.

Slippage

The difference between the expected price of a trade and the actual execution price, which can be positive or negative.

Smart Order Routing (SOR)

An automated algorithm that analyzes multiple liquidity venues in real time to route each order to the source offering the best available execution.

Also: SOR

Spread

The difference between the bid and ask price of an asset, representing a core component of trading cost.

Best Execution

The obligation for a broker to execute client orders at the most favorable terms reasonably available, considering price, speed, and likelihood of execution.

Order Routing

The mechanism by which a broker directs client orders to specific liquidity providers or execution venues based on predefined rules.