Trade Or Fade Rule

It sounds like a headline you'd see on the relationship section of BuzzFeed. But this one has to do with options trading.

The underlying principle of the rule states that an options market maker has to trade at the best available bid price. Basically, they have to make the trade at the optimal price...or go away.

The rule is meant to prevent a practice known as trade-throughs, which involve purposely taking a worse bid...a practice obviously ripe for corruption.