Hi, could someone explain what are partial fills in context of the following from the readings please? (Develop written Trade Allocation Procedures) developing a policy to address such issues as calculating execution prices and partial fills when trades are grouped or blocked for efficiency purposes… Thank you
You have an order for 100,000 shrs of xyz for 5 clients but are only executed (filled) on 50,000 shares. that’s a partial fill. you must develop a policy that treats the clients fairly for allocating this stock. for example, giving all of the shares of winning trades to your favorite accounts and losing trades to other accounts won’t fly. cfa likes the pro rata allocation method.
thank you understood