Stocks order routing and execution quality

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We use DriveWealth as our clearing broker. The revenue DriveWealth receives from rebates are shared with us, helping us cover the costs of operating our business and allowing us to offer you commission-free trading.*

 

Where does DriveWealth send orders and how are these decided? 

Consistent with SEC Rule 606, DriveWealth discloses the market makers where orders are routed and other information here. They consider many factors (execution quality, speed, etc.) when deciding which market makers to connect with. They also regularly monitor the market makers’ execution quality and performance. 

 

What is the execution quality for orders on DriveWealth?

Reg NMS requires your order gets executed at the national best bid and offer, or better, at the time of execution. When measured at the time of routing, our customers’ orders get executed at the NBBO or better.

 

Is DriveWealth incentivized to send orders to one market maker over another?

No. To ensure a fair system, DriveWealth doesn’t take rebates into consideration when choosing which market maker will execute your orders. Also, all market makers with whom they work have the same rebate rate. They send your orders to the market maker that’s most likely to give you the best execution quality.

 

How much does DriveWealth make in rebates?

Drivewealth shares up to $0.002 in rebates per share traded to Passfolio, which is subject to volume and the security traded. Other brokerages earn rebates and charge you a per-trade commission fee on top of this.

 

Why does DriveWealth report rebates on a per-share basis instead of a per-dollar basis?

DriveWealth reports the rebate structure on a per-share basis because this accurately reflects the arrangement they have with market makers. Even though other brokerages report rebates on a per-dollar basis, this doesn’t necessarily mean that their program is structured that way. Typically, there are carve-outs and in some cases, there are different rebates for different stocks and order sizes.

 

Do you, DriveWealth or the market makers front-run orders?

Front-running is an illegal action taken by brokers that have foreknowledge of a big non-publicized transaction that will influence the price of the asset, enters in a trade to try and profit from it. We do not do that.

 

Do you, DriveWealth or the market makers mark up orders?

No. Regulation NMS requires orders to be executed at the best price among all of the exchanges. This best price is also known as the national best bid and offer, or the NBBO.

 

Does Passfolio sell customer data?

No. We take the privacy and security of our customers extremely seriously. We do not, have not, and will not sell customer information.

 

If you have any further questions regarding orders routing and execution, please don’t hesitate to contact DriveWealth at support@drivewealth.com.

 

*Please see our Disclosures on other charges

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