On-Floor Orders

Definition

The term on-floor refers to an order that is placed by a member of an exchange to trade securities in their account.  On-floor orders typically refer to the trading of equities.

Explanation

When a member of an exchange places an order to trade stocks in their account, the transaction is referred to as an on-floor order.  More commonly, these transactions are placed through brokers, and are referred to as off-floor orders.

Floor traders have a business relationship with member firms, which pay substantial fees for the right to trade on the exchange floor.  However, exchange rules require the execution of off-floor transactions before on-floor orders.

Related Terms

Do Not Reduce ordersNot-Held orders, order book, Small-Order Execution System, order imbalance, switch orders, held orders, fractional discretion orders