SIE: 9.2.11. No Interpositioning

9.2.11.  No Interpositioning

The best execution rule requires broker-dealers to make reasonable efforts to find as favorable a price as possible for a customer’s transaction, given the prevailing conditions of the market. However, best execution means more than getting the customer a favorable price. Among the factors that will be considered in determining whether a broker-dealer has used reasonable diligence are:

• • Character of the market for the security, determined by details such as its price, volatility, and liquidity
• • Size and type of transaction
• • Number of markets checked
• • Accessibility of the quotation
• • Terms and conditions of the transaction as communicated to the broker-dealer

For municipal securities, the information that the dealer reviewed to determine the market price for the security will also be considered.

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