An investment manager directs a certain client's orders to a certain broker for execution in exchange for research from the broker. This arrangement is referred to as a:

Question

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A soft dollar arrangement is a commission arrangement between an investment manager and a broker where the investment manager directs orders to the broker in exchange for research products or services rather than paying for them directly. This allows the investment manager to access valuable research without paying for it out of pocket, and the broker benefits from increased business volume.

An Investment Manager Directs a Certain Client's Orders to a Certain