For problem part 2 the strategy mentioned is vwap. Why it cant be twap?
I don’t have my book with me right now, but If the example you are refering to is the one I’m thinking it is it is best to use VWAP because VWAP breaks up the trade according to the average volume profile for the security. the graph shows that for this security there is more volume at the end of the day, so the VWAP strategy would trade more shares at the end of the day than at the beginning to mimic the volume profile of the security. TWAP on the other hand would break up the trade evenly throughout the day, so the # of shares traded at the beginning of the day would be the same as at the end. This would be abetter strategy for a security that does not have a well defined volume profile.