Finance: What is Power Of Attorney (Trading Authorization)?

Power of attorney refers to the authorization to conduct business on legal and financial matters on behalf of another party. So...choose wisely.

College and CareerPersonal Finance
CoursesFinance Concepts
FinanceFinance Definitions
Financial Responsibility
Personal Finance
Finance and EconomicsTerms and Concepts
LanguageEnglish Language
Life SkillsFinance Definitions
Personal Finance
SubjectsFinance and Economics
Terms and ConceptsBanking
Board of Directors
Bonds
Careers
Credit
Ethics/Morals
Incorporation
Insurance
Regulations
Stocks
Trusts and Estates

Transcript

00:24

Beauregard to make trades on her behalf and has given him trading authorization

00:29

to manage her account that is he can make trades without pre-clearing each [Maybelle carries brownie trays]

00:34

one with her his status is analogous to having power of attorney in doing

00:40

various legal and financial things in life like you might sign over power of

00:46

attorney to your legalese proficient uncle to handle negotiating the terms of

00:51

your juggling contract because well with your busy schedule you need some help [hand signing power of attorney papers]

00:55

keeping all your you know balls in the air and you have the option between

00:59

granting general or limited power of attorney like if you want your uncle to

01:05

handle all of your finances general POA makes sense but if you only want him to

01:10

handle your contracts like in a specific narrow area like at this brokerage

01:14

account only with equities or dead or something like that well then a limited

01:18

POA would be more appropriate so ya trading Authority is the Wall Street

01:23

e-version of power of attorney you might really want to put a few grand into the

01:27

stock market but as far as you know the stock market is just a market where they

01:31

keep produce you know stocked so you turn over authority to make the actual [Maybelle at the food market]

01:36

decisions and perform the actual trades to someone you trust to you know more [Maybelle brings food bag home]

01:41

efficiently handle your money because if everything's left up to little old miss

01:44

blue hair her entire life savings could end up invested in sweaters for cats Inc [Maybelle dresses her cat in a sweater]