A proposed service of The Nasdaq Stock Market that provides investors with market-wide price protection of their limit orders, the opportunity to obtain price improvement in buying and selling Nasdaq stocks, and increased access to Nasdaq.
Here's an example of how price improvement can work: Let's say you enter a market order to sell 500 shares of a stock. The current quote is $20.
Elliott noted that this first wave shows very gradual price improvement and turns back on itself frequently to test lower levels. He also points out that this wave takes a long time to complete and gives a true bottoming appearance to the chart.
[8] Exchanges claim that the procedure benefits all traders by creating more market liquidity and the opportunity for price improvement.
Price Improvement
Process Date
Round Lots of Shares
Security Identification Systems
Shorting Stocks
Shorting Against the Box
Size of the Market
Tick, Up Tick, and Down Tick
Transferring an Account
Can You Trust The Tape?
Some may take more time but possibly offer a better price. Here, the chance of the price improvement would have to be weighed against the slower execution meaning there was more risk the price will move against you.
On the other hand, a rise in the stock price produces a nice profit for the front-running market maker that offered minimal price improvement.
 See also: Order, Stock, Offer, Market, Trading
  
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