Offer

What it is:

An offer is a communication of interest in buying or selling an asset. In other contexts, it might refer to the act of making something available for sale.

How it works/Example:

For example, a retailer might offer a men's watch for $2,000, meaning that the retailer will sell the watch for that amount. However, a customer might come into the store and offer $1,500 for the watch, meaning that the customer is expressing an interest in buying the watch for that amount.

Why it Matters:

Offers make the business world go around, because a fundamental rule of markets in a capitalistic economy is that a product or service is worth only what someone is willing to pay for it. Anybody who has tried to sell an asset in a down market has probably learned this rule the hard way.

Best execution refers to the imperative that a broker, market maker, or other agent acting on behalf of an investor is obligated to execute the investor's order in a way that is most advantageous to the investor rather than the agent.