When is it best to use either. I know when you use either/or rather than VWAP or Implementation Shortfall, but under which curcumstances is crossing trade or broker agent best?
Crossing trade is for non-urgent orders that can be filled over multiple days if it is a highish portion of volume. Broker is for high percentage of volume that requires quick execution. Emerging markets as well for broker. First example I am buying PSPN stock and I am establishing a position over 2 weeks that will be 50% of market volume in any given day. ECN would work for this trade. Second example, PSPN stock and I want it all today, it is 50% of daily float. Urgency and costs are the two keys.
If all conditions suited for either crossing or Broker, then chose Crossing when market participants are institutional investors or want to save money trading or else broker (also for emerging mkt)
bills Wrote: ------------------------------------------------------- > If all conditions suited for either crossing or > Broker, then chose Crossing when market > participants are institutional investors or want > to save money trading or else broker (also for > emerging mkt) Quick execution also choose broker. Crossing network often not assurity of completion. Confidentiality also higher on ECN.