An investor preferentially routes their order to the broker/dealer specified in the soft dollar relationship and does not have to pay real money, for the research or other services. This practice is called paying "________" (i.e., directing their order flow) for the ancillary research.

Question

Quizplus · Accepted Answer

The practice described in the question is commonly known as using "soft dollars" to pay for ancillary research. This means that instead of paying for research and other services with real money, the investor routes their order to a broker/dealer with whom they have a soft dollar relationship. In this relationship, the broker/dealer provides research and other services in exchange for the investor directing their order flow to them.

An Investor Preferentially Routes Their Order to the Broker/dealer Specified