19. The following statement appears in a report to the Joint Advisory Committee on Emerging Regulatory Issues,
Question:
19. The following statement appears in a report to the Joint Advisory Committee on Emerging Regulatory Issues, September 30, 2010:
Generally, a customer has a number of alternatives as to how to execute a large trade. First, a customer may choose to engage an intermediary, who would, in turn, execute a block trade or manage the position. Second, a customer may choose to manually enter orders into the market. Third, a customer can execute a trade via an automated execution algorithm, which can meet the customer’s needs by taking price, time or volume into consideration. Effectively, a customer must make a choice as to how much human judgment is involved while executing a trade.20 Explain each of these alternatives for executing a large trade.
Step by Step Answer:
Foundations Of Global Financial Markets And Institutions
ISBN: 9780262039543
5th Edition
Authors: Frank J. Fabozzi, Frank J. Jones, Francesco A. Fabozzi, Steven V. Mann