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Stocks

Jitney Order

As a knowledgeable finance professor, I want to share with you the concept of "execution and clearing" in the context of stock exchanges. This refers to the process of one member of the exchange executing orders on behalf of another member. For instance, if a smaller investment dealer, let's call them A, does not have enough business to maintain a trader on the exchange, they may give their orders to a larger organization, B, who is a member of the exchange. In this scenario, A pays a reduced commission to B for executing their orders.

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