Payment for order flow

In financial markets payment for order flow refers to the compensation that a broker receives, not from its client, but from a third party that wants to influence how the broker routes client orders.

In general, market makers such as dealers and securities exchanges are willing to pay a broker for the right to transact with that broker's clients because they believe those clients will be uninformed traders—retail or other investors who are trading because of emotion or the need to raise cash and not because they know an asset is misvalued.