SHOP

Private Automated Trading Systems which execute large orders so as to not move market prices. Dark pools do not show their liquidity to the general public. Block trades are often executed in dark pools.

See Click-to-Trade.

Alternative source of funding, through the internet, by raising small amounts of money from many individuals or organizations.

Covenants, in the financial context, are found in debt agreements, e.g., loans or bonds. These covenants are promises agreed to by the borrower in a bond/loan documentation/agreement. Covenants are put in place to protect the lender from the borrower going bankrupt or to help ensure the borrower will pay back…

Traditional bank loans incorporate financial (maintenance) covenants, which are designed to give the lender warning signs of a borrower’s negative financial changes when they are breached and allow lenders to either amend the covenant for a period of time or restructure the deal to allow the borrower additional time to…

See Central Limit Order Book.

Ability to immediately trade on prices that are streamed by dealers.

Electronic trading platform using a centralized engine to match all bids and offers according to price and time priority. Allows users to trade with each other and not have to go through an intermediary. Trade orders are seen in real time.

Large size trades executed in the market place. For example, in the equity markets, a trade containing 10,000 shares or greater is considered a block trade. If executed in one trade, then the execution of the trade can impact the market price of the security. The blocks can be divided…

SEC requirement that brokers show investors the best bid and offer price for a stock at any given time.

Automated Trading or AT is part of the electronic trading universe. Automated Trading refers to executing trades based on algorithms, or ALGOS, which are based on a set of pre-defined rules e.g., price, time, and volume among others. Market making and High Frequency Trading (HFT) may also be considered automated…

Pre-approved group of institutional firms who enter into an agreement with the ETF sponsor such as Blackrock/iShares. APs offer a basket of securities (or receive a basket of securities) from the ETF sponsor in exchange for ETF shares. APs may create or redeem (buy or sell) ETFs on behalf of…