Proxy is a limited authority given by stockholders to another party to vote their shares in a corporate election. The stockholder may specify how the votes are cast or may give the party discretion.
Applying "Proxy" to Securities Exams:
A Proxy allows an investor to vote in a corporate election without appearing at the meeting to vote in person. If the investor attends the meeting the investor’s proxy will be canceled to ensure that that investor does not cast votes twice. A proxy may instruct the firm representing the investor how to vote or if left blank the firm usually must vote in accordance with management’s recommendation.