Directed brokerage

CFA Level I
#1

Hi, can someone please explain the concept of ‘directed brokerage’ and how it differs from normal brokerage? Thanks

#2

It’s when the client instructs their advisor to use a specific broker to conduct trades through. You’re allowed to use a broker that does not have best execution to conduct client trades, as long as you tell the client that another broker offers a better deal. Someone verify this, I haven’t looked at the books in a month, so I may be mistaken.

#3

Thanks for your help - much appreciated.