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Trade-through

An execution at a price worse than a protected quote displayed on another venue at the same moment, which is prohibited except under listed exceptions.

The word describes the act, not an opinion: a buy that prints above someone else's protected offer has traded through it. Whether it is a violation depends on whether an exception applies.

For investors the practical question is different from the legal one. Your 50,000-share order can be filled entirely at inferior prices without a single rule breach, because protection covers only the displayed top of each book.

Example: exchange A shows 300 shares offered at 8.05. Your broker prints 10,000 at 8.06 without taking or sweeping the 8.05. That is a trade-through of 300 shares, worth one cent each, or $3 — trivial in money, but a compliance breach nonetheless.

Related: order-protection-rule, protected-quote, nbbo, best-execution

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