Commission

Business / Taxes / Commission: Securities brokers and other sales agents typically charge a commission, or sales charge, on each transaction. With traditional, full-service brokers, the charge is usually a percentage of the total cost of the trade, though some brokers may offer favorable rates to frequent traders. Online brokerage firms, on the other hand, usually charge a flat fee for each transaction, regardless of the value of the trade. The flat fee may have certain limits, however, such as the number of shares being traded at one time. The commissions on some transactions, such as stock trades, are reported on your confirmation slip. But commissions on other transactions are not reported separately. In the case of cash value life insurance, for example, the commission may be as large as a year's premium.

Commission Broker

Business / Finance / Commission Broker: The fee paid to a broker to execute a trade, based on number of shares, bonds, options, and/or their dollar value. In 1975, deregulation led to the establishment of discount brokers, who charge lower MORE

Futures Commission Merchant (FCM)

Business / Finance / Futures Commission Merchant (FCM): A term used to designate all contracts covering the sale of financial instruments or physical commodities for future delivery on a commodity exchange. MORE

Negotiated Commission

Business / Finance / Negotiated Commission: An unfixed broker's commission that is determined through negotiation, depending on the specifics of the trades performed. MORE

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