Request-for-Quote (RFQ)

A request-for-quote (RFQ) is a first step in certain financial transactions. A potential trader will submit an RFQ to a dealer that indicates an asset, quantity, and direction. The dealer will then tell the requester how much it would cost them to execute that order. RFQs are generally only valid for a matter of seconds. More volatile assets will generally have a shorter time period of validity. If a trader accepts the RFQ then they will lock in that order with the dealer. Sometimes the order is settled instantly, although many dealers will allow for settlement to occur at a later date.