Two dollar broker is an independent exchange member who executes orders for commission house brokers and other customers, for a fee.
Applying "Two Dollar Broker" to Securities Exams:
The term two dollar broker came about as a result of the commissions that the independent exchange members would charge to execute an order for their clients or commission house brokers. These brokers would generally charge $2 for every 100 shares contained in the order. As new trading platforms and technology have advanced these fees have been reduced dramatically