Our commitment to execution quality
You trust us to handle your trades the right way with diligence, care, and precision. That's where the Schwab Order Execution Advantage® comes in. With our ongoing, rigorous reviews of how market venues perform, we continuously monitor execution quality and adjust where orders go based on performance, technology, and changing conditions.
In Q3 2026, Schwab clients received $922 million in price improvement on their exchange-listed equity orders.1
Schwab ranked one of the Best Online Brokers for Trade Execution, Speed, and Price by Investor's Business Daily, 2026.5
Explore the data, processes, and terminology behind your trades.
The standards behind every trade
- Built for results: Orders are routed based on what's most likely to deliver the best price and execution.
- Measured beyond price: We evaluate price, speed, accuracy, market depth, order size, trading characteristics, liquidity, and more to help provide the best opportunities for price improvement.
- Always transparent: We provide visibility to the best quoted prices through National Best Bid and Offer (NBBO).
- Validated for accuracy: Execution quality is continuously monitored and independently analyzed by S3 Matching Technologies to help ensure objective, consistent results.
Frequently asked questions about order execution quality
Best execution means brokers seek the most favorable terms reasonably available, such as price, speed, and likelihood of fill. Even small differences can affect your costs and potential returns over time.
Price improvement can help reduce your trading costs and potentially increase your returns. Price improvement happens when your trade is executed at a better price than the quoted market price (NBBO), such as buying lower or selling higher than that quoted price.
Key metrics include price improvement, effective spread, execution speed, and fill rates. These indicators help assess how efficiently trades are executed. Investors often consider these alongside routing transparency and overall trading costs to form a more complete view of broker quality and performance.
It's the difference between the highest price a buyer will pay and the lowest price a seller will accept. Wider spreads can mean higher trading costs.
Quoted spread is the displayed difference between bid and ask. Effective spread reflects the actual cost based on your execution price and provides a more realistic view of what you paid to trade.
Most retail trades are executed through market makers, exchanges, or alternative trading systems (ATSs). Brokers decide where to route orders based on factors such as price, liquidity, and execution quality. Rule 606 reports provide a breakdown of these destinations, helping investors see which venues handle the majority of their trades.
Market makers are firms that provide liquidity by continuously quoting buy and sell prices for securities. They often execute retail trades by filling orders from their own inventory or offsetting them in the market. Their role can help improve execution speed and price.
Slippage occurs when a trade is executed at a different price than expected, often due to market movement or liquidity conditions. It can increase trading costs or reduce proceeds. While some slippage is unavoidable, strong execution quality practices can help minimize its impact and improve overall trade outcomes.
