• Arbitrage

In economics and finance, arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices at which the unit is traded. When used by academics, an arbitrage is a transaction that involves no negative cash flow at any probabilistic or temporal state and a positive cash flow in at least one state; in simple terms, it is the possibility of a risk-free profit after transaction costs. For example, an arbitrage opportunity is present when there is the possibility to instantaneously buy something for a low price and sell it for a higher price.

In principle and in academic use, an arbitrage is risk-free; in common use, as in statistical arbitrage, it may refer to expected profit, though losses may occur, and in practice, there are always risks in arbitrage, some minor (such as fluctuation of prices decreasing profit margins), some major (such as devaluation of a currency or derivative). In academic use, an arbitrage involves taking advantage of differences in price of a single asset or identical cash-flows; in common use, it is also used to refer to differences between similar assets (relative value or convergence trades), as in merger arbitrage.

https://en.wikipedia.org/wiki/Arbitrage

• What Is Arbitrage?

With foreign exchange investments, the strategy known as arbitrage lets traders lock in gains by simultaneously purchasing and selling an identical security, commodity, or currency, across two different markets. This move lets traders capitalize on the differing prices for the same said asset across the two disparate regions represented on either side of the trade.

Arbitrage describes the act of buying a security in one market and simultaneously selling it in another market at a higher price, thereby enabling investors to profit from the temporary difference in cost per share. In the stock market, traders exploit arbitrage opportunities by purchasing a stock on a foreign exchange where the equity's share price has not yet adjusted for the exchange rate, which is in a constant state of flux. The price of the stock on the foreign exchange is therefore undervalued compared to the price on the local exchange, positioning the trader to harvest gains from this differential. Although this may seem like a complicated transaction to the untrained eye, arbitrage trades are actually quite straightforward and are thus considered low-risk.

https://www.investopedia.com/../what-is-arbitrage

• Example of Arbitrage

Consider the following arbitrage example: TD Bank (TD) trades on both the Toronto Stock Exchange (TSX) and the New York Stock Exchange (NYSE).12 On a given day, let's assume the stock trades for $63.50CAD on the TSX and for $47.00USD on the NYSE. Let's further assume the exchange rate of USD/CAD is $1.37, meaning that $1USD = $1.37CAD, where $47USD = $64.39CAD. Under this set of circumstances, a trader can purchase TD shares on the TSX for $63.50CAD and can simultaneously sell the same security on the NYSE for $47.00USD, which is the equivalent of $64.39CAD, ultimately yielding a profit of $0.89 per share ($64.39 - $63.50) for this transaction.

https://www.investopedia.com/../what-is-arbitrage

• Beware of Transaction Costs

When contemplating arbitrage opportunities, it is essential to take transaction costs into consideration, because if costs are prohibitively high, they may threaten to neutralize the gains from those trades. Case in point: In the aforementioned scenario, if the trading fee per share exceeded $0.89, the total arbitrage return would nullify those profits.

https://www.investopedia.com/../what-is-arbitrage

• What Is a Block?

A block refers to a large order of the same security to be bought or sold by institutional or other large investors. There is no official size designation constituting a block of securities, but a commonly used threshold is more than 10,000 equity shares or a total market value of more than $200,000.1 Securities traded in block trades facilitate trading by institutional investors or other large investors that require such bulk trades to meet their needs.

https://www.investopedia.com/terms/b/block.asp

• Understanding Blocks

Users of block trades include large-scale portfolio managers and individual investors. Asset managers of large mutual funds, retirement funds, hedge funds, banks, and insurance companies take a longer-term view of markets when making investment decisions and take large positions in a stock once the decision is made. Large corporations that engage in a large stock buyback may also use block trading to execute their transactions. This type of market participant manages hundreds of millions to tens of billions of dollars. Available data show that approximately 20% of the trading volume on the NASDAQ is block trading.

https://www.investopedia.com/terms/b/block.asp

• Advantages of Block Trades

Extreme imbalances in the supply and demand for a particular stock result from a large acquisition or liquidation of a stock, which increases price volatility. When a fund manager decides to acquire significant stock or seeks to liquidate substantial stock that is not performing, prudence demands that the transaction be conducted in a way that minimizes the adverse effects on the market price that the overwhelming disparity in supply and demand causes.

All large-scale stock transactions have an optimal average price target set by the fund manager. Creating too much volatility may cause the price to trade away from the desired average price. Using block trades via block houses allows a fund manager to make the needed transactions in such a way that minimizes the impact on price volatility and achieves a better average price.

Execution costs are also a key concern. Attempting to fill a large buy or sell order by breaking it up into smaller transactions ultimately increases costs and may have the same adverse effect on price volatility. Block trading helps to minimize this effect.

https://www.investopedia.com/terms/b/block.asp

• Block Trading Signals

When institutional investors use block trading to fill a large order over a period, the price will rally or decline accordingly. Savvy day traders who are quick to spot the increase in volume on one side of the market can exploit the market imbalance and capture some easy low-risk profits from the added volatility and predictable price movements. Traders typically take a position on the same side as the transacting institutional investors and ride the price waves with them. Once the institutional investors have filled their large orders, price volatility returns to normal.

https://www.investopedia.com/terms/b/block.asp

• Block Trades

A block trade is a high-volume transaction in a security that is privately negotiated and executed outside of the open market for that security. Major broker-dealers often provide "block trading" services—sometimes known as "upstairs trading desks"—to their institutional clients. In the United States and Canada a block trade is usually at least 10,000 shares of a stock or $100,000 of bonds but in practice significantly larger.

For instance, a hedge fund holds a large position in Company X and would like to sell it completely. If this were put into the market as a large sell order, the price would sharply drop. By definition, the stake was large enough to affect supply and demand causing a market impact. Instead, the fund may arrange for a block trade with another company through an investment bank, benefiting both parties: the selling fund gets a more attractive purchase price, while the purchasing company can negotiate a discount off the market rates. Unlike large public offerings, for which it often takes months to prepare the necessary documentation, block trades are usually carried out at short notice and closed quickly.

For a variety of reasons, block trades can be more difficult than other trades and often expose the broker-dealer to more risk. Most notably, because the broker-dealer is committing to a price for a large amount of securities, any adverse market movement can saddle the broker-dealer with a large loss if the position has not been sold. As such, engaging in block trading can tie up a broker-dealer's capital. Further, the fact that a large, well-informed money manager wants to sell (or perhaps buy) a large position in a particular security may connote future price movements (i.e., the money manager may have an informational advantage); by taking the opposite side of the transaction, the broker-dealer runs the risk of adverse selection.

https://en.wikipedia.org/wiki/Block_trade

• Dark Pool

In finance, a dark pool (also black pool) is a private forum (alternative trading system or ATS) for trading securities, derivatives, and other financial instruments. Liquidity on these markets is called dark pool liquidity. The bulk of dark pool trades represent large trades by financial institutions that are offered away from public exchanges like the New York Stock Exchange and the NASDAQ, so that such trades remain confidential and outside the purview of the general investing public. The fragmentation of electronic trading platforms has allowed dark pools to be created, and they are normally accessed through crossing networks or directly among market participants via private contractual arrangements. Generally dark pools are not available to the public, but in some cases they may be accessed indirectly by retail investors and traders via retail brokers.

One of the main advantages for institutional investors in using dark pools is for buying or selling large blocks of securities without showing their hand to others and thus avoiding market impact, as neither the size of the trade nor the identity are revealed until some time after the trade is filled. However, it also means that some market participants are disadvantaged, since they cannot see the orders before they are executed; prices are agreed upon by participants in the dark pools, so the market is no longer transparent.

https://en.wikipedia.org/wiki/Dark_pool

• Introduction to Dark Pools

Dark pools are private exchanges for trading securities that are not accessible by the investing public. Also known as “dark pools of liquidity,” the name of these exchanges is a reference to their complete lack of transparency. Dark pools came about primarily to facilitate block trading by institutional investors who did not wish to impact the markets with their large orders and obtain adverse prices for their trades.

Dark pools are sometimes cast in an unfavorable light but, in reality, they serve a purpose. However, their lack of transparency makes them vulnerable to potential conflicts of interest by their owners and predatory trading practices by some high-frequency traders.

https://www.investopedia.com/../introduction-dark-pools.asp

• The Rationale for Dark Pools

Dark pools emerged in the late 1980s.1 According to the CFA Institute, non-exchange trading has recently become more popular in the U.S. Estimates show that it accounted for approximately 40% of all U.S. stock trades in 2017 compared with an estimated 16% in 2010. The CFA also estimates that dark pools are responsible for 15% of U.S. volume as of 2014.

Why did dark pools come into existence? Consider the options available to a large institutional investor who wanted to sell one million shares of XYZ stock before the advent of non-exchange trading. This investor could either:

- Work the order through a floor trader over the course of one or two days and hope for a decent VWAP (volume-weighted average price).

- Split the order up into, for example, five pieces and sell 200,000 shares per day.

- Sell small amounts until a large buyer could be found who was willing to take up the full amount of the remaining shares.

The market impact of a sale of one million XYZ shares could still be sizable regardless of which option the investor chose since it was not possible to keep the identity or intention of the investor secret in a stock exchange transaction. With options two and three, the risk of a decline in the period while the investor was waiting to sell the remaining shares was also significant. Dark pools were one solution to these issues.

https://www.investopedia.com/../introduction-dark-pools.asp

• Why Use a Dark Pool?

Contrast this with the present-day situation, where an institutional investor can use a dark pool to sell a one million share block. The lack of transparency actually works in the institutional investor’s favor since it may result in a better-realized price than if the sale was executed on an exchange. Note that, as dark pool participants do not disclose their trading intention to the exchange before execution, there is no order book visible to the public. Trade execution details are only released to the consolidated tape after a delay.

The institutional seller has a better chance of finding a buyer for the full share block in a dark pool since it is a forum dedicated to large investors. The possibility of price improvement also exists if the mid-point of the quoted bid and ask price is used for the transaction.

https://www.investopedia.com/../introduction-dark-pools.asp

• Broker-Dealer-Owned Dark Pool

These dark pools are set up by large broker-dealers for their clients and may also include their own proprietary traders. These dark pools derive their own prices from order flow, so there is an element of price discovery. Examples of such dark pools include Credit Suisse's CrossFinder, Goldman Sachs’ Sigma X, Citibank’s Citi-Match, and Morgan Stanley’s MS Pool.

https://www.investopedia.com/../introduction-dark-pools.asp

• Exchange-Owned Dark Pool

These are dark pools that act as agents, not as principals. As prices are derived from exchanges–such as the midpoint of the National Best Bid and Offer (NBBO), there is no price discovery. Examples of agency broker dark pools include Instinet, Liquidnet and ITG Posit, while exchange-owned dark pools include those offered by BATS Trading and NYSE Euronext.

https://www.investopedia.com/../introduction-dark-pools.asp

• Electronic MM Dark Pools

These are dark pools offered by independent operators like Getco and Knight, who operate as principals for their own accounts. Like the broker-dealer-owned dark pools, their transaction prices are not calculated from the NBBO, so there is price discovery.

https://www.investopedia.com/../introduction-dark-pools.asp

• Insider Trading

Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider information is illegal. This is because it is seen as unfair to other investors who do not have access to the information, as the investor with insider information could potentially make larger profits than a typical investor could make. The rules governing insider trading are complex and vary significantly from country to country. The extent of enforcement also varies from one country to another. The definition of insider in one jurisdiction can be broad, and may cover not only insiders themselves but also any persons related to them, such as brokers, associates, and even family members. A person who becomes aware of non-public information and trades on that basis may be guilty of a crime.

Trading by specific insiders, such as employees, is commonly permitted as long as it does not rely on material information not in the public domain. Many jurisdictions require that such trading be reported so that the transactions can be monitored. In the United States and several other jurisdictions, trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the regulator or publicly disclosed, usually within a few business days of the trade. In these cases, insiders in the United States are required to file a Form 4 with the U.S. Securities and Exchange Commission (SEC) when buying or selling shares of their own companies. The authors of one study claim that illegal insider trading raises the cost of capital for securities issuers, thus decreasing overall economic growth. However, some economists, such as Henry Manne, have argued that insider trading should be allowed and could, in fact, benefit markets.

https://en.wikipedia.org/wiki/Insider_trading

• Definition of "Insider"

In the United States, Canada, Australia, Germany and Romania for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors and any beneficial owners of more than 10% of a class of the company's equity securities. Trades made by these types of insiders in the company's own stock, based on material non-public information, are considered fraudulent since the insiders are violating the fiduciary duty that they owe to the shareholders. The corporate insider, simply by accepting employment, has undertaken a legal obligation to the shareholders to put the shareholders' interests before their own, in matters related to the corporation. When insiders buy or sell based upon company-owned information, they are said to be violating their obligation to the shareholders.

For example, illegal insider trading would occur if the chief executive officer of Company A learned (prior to a public announcement) that Company A will be taken over and then bought shares in Company A while knowing that the share price would likely rise.

In the United States and many other jurisdictions, however, "insiders" are not just limited to corporate officials and major shareholders where illegal insider trading is concerned but can include any individual who trades shares based on material non-public information in violation of some duty of trust. This duty may be imputed; for example, in many jurisdictions, in cases of where a corporate insider "tips" a friend about non-public information likely to have an effect on the company's share price, the duty the corporate insider owes the company is now imputed to the friend and the friend violates a duty to the company if he trades on the basis of this information.

https://en.wikipedia.org/wiki/Insider_trading

• Understanding Insider Buying

Insider buying is not a crime when the buying is based on public information. Additionally, since insiders have unique insights into their own companies, they often gobble up often shares when they believe the stock is undervalued. That's why people pay attention to insider buying.

The availability or accessibility of information is the crucial legal difference between insider trading and insider buying. Insider trading can happen when corporate officers, executives, or board members know of new products, merger negotiations, or other circumstances that could cause the stock price to move higher.

Those in this position must adhere to regulations regarding public and private information to avoid penalties or legal action. Generally, insiders are not allowed to trade on any information that is not available to the public.

Insider buying, on the other hand, can occur when an executive of a company believes that the public is not valuing shares properly. That is, the insider feels that the stock is at attractive levels and represents a worthwhile investment. Knowing that insiders are purchasing shares of their own company can signal an opportunity to buy the stock as well, if those insiders are correct in viewing the stock as a bargain.

https://www.investopedia.com/terms/i/insider-buying.asp

• Types of Insider Buying

If a company wins a new contract with a client, it may be a stepping stone for more contracts to follow. Therefore, reports that the company is adding new contracts, which are also available to the general public, could prompt insiders to buy up shares in the company based on a belief that the executive leadership has put the business on an advanced growth trajectory. Changes in regulations, new product launches, and reports of new partnerships might also serve as catalysts for insider buys.

The type of insider can motivate other parties to invest or expand their own stake in the company. If a member of the board of directors purchases more shares, it could attract the attention of the public. If senior executives acquire more shares, analysts and investors might use the activity to assess the company’s potential progress.

Executives naturally have a direct hand in implementing the plans set forth for the company. The individual success of an executive plays a key role in the company’s development. It is common practice for companies to reward executives and some key employees with shares as part of their compensation.

Companies can also offer employees options to acquire additional shares at discount prices. On the other hand, when senior executives buy shares in great quantities without being prompted by discount programs, it might signal a vote of confidence on the future prospects for the company.

https://www.investopedia.com/terms/i/insider-buying.asp

• Legal

Legal trades by insiders are common, as employees of publicly traded corporations often have stock or stock options. These trades are made public in the United States through Securities and Exchange Commission filings, mainly Form 4.

U.S. SEC Rule 10b5-1 clarified that the prohibition against insider trading does not require proof that an insider actually used material nonpublic information when conducting a trade; possession of such information alone is sufficient to violate the provision, and the SEC would infer that an insider in possession of material nonpublic information used this information when conducting a trade. However, SEC Rule 10b5-1 also created for insiders an affirmative defense if the insider can demonstrate that the trades conducted on behalf of the insider were conducted as part of a pre-existing contract or written binding plan for trading in the future.

For example, if an insider expects to retire after a specific period of time and, as part of retirement planning, the insider has adopted a written binding plan to sell a specific amount of the company's stock every month for two years, and the insider later comes into possession of material nonpublic information about the company, trades based on the original plan might not constitute prohibited insider trading.

https://en.wikipedia.org/wiki/Insider_trading

• SEC Regulations

SEC regulation FD ("Fair Disclosure") requires that if a company intentionally discloses material non-public information to one person, it must simultaneously disclose that information to the public at large. In the case of an unintentional disclosure of material non-public information to one person, the company must make a public disclosure "promptly." - Insider trading, or similar practices, are also regulated by the SEC under its rules on takeovers and tender offers under the Williams Act.

https://en.wikipedia.org/wiki/Insider_trading

• Securities and Exchange Commission

The U.S. Securities and Exchange Commission (SEC) is a large independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary purpose of the SEC is to enforce the law against market manipulation

The SEC has a three-part mission: to protect investors; maintain fair, orderly, and efficient markets; and facilitate capital formation.

To achieve its mandate, the SEC enforces the statutory requirement that public companies and other regulated companies submit quarterly and annual reports, as well as other periodic reports. In addition to annual financial reports, company executives must provide a narrative account, called the "management discussion and analysis" (MD&A), that outlines the previous year of operations and explains how the company fared in that time period. MD&A will usually also touch on the upcoming year, outlining future goals and approaches to new projects. In an attempt to level the playing field for all investors, the SEC maintains an online database called EDGAR (the Electronic Data Gathering, Analysis, and Retrieval system) online from which investors can access this and other information filed with the agency.

Quarterly and semiannual reports from public companies are crucial for investors to make sound decisions when investing in the capital markets. Unlike banking, investment in the capital markets is not guaranteed by the federal government. The potential for big gains needs to be weighed against that of sizable losses. Mandatory disclosure of financial and other information about the issuer and the security itself gives private individuals as well as large institutions the same basic facts about the public companies they invest in, thereby increasing public scrutiny while reducing insider trading and fraud.

wiki/U.S._Securities_and_Exchange_Commission

• What Is The SEC

The U.S. Securities and Exchange Commission (SEC) is an independent federal government regulatory agency responsible for protecting investors, maintaining fair and orderly functioning of the securities markets, and facilitating capital formation. It was created by Congress in 1934 as the first federal regulator of the securities markets. The SEC promotes full public disclosure, protects investors against fraudulent and manipulative practices in the market, and monitors corporate takeover actions in the United States. It also approves registration statements for bookrunners among underwriting firms.

Generally, issues of securities offered in interstate commerce, through the mail or on the Internet, must be registered with the SEC before they can be sold to investors. Financial services firms—such as broker-dealers, advisory firms and asset managers, as well as their professional representatives—must also register with the SEC to conduct business. In example: they would be responsible for approving any formal bitcoin exchange.

https://www.investopedia.com/terms/s/sec.asp

• How It Works

The SEC's primary function is to oversee organizations and individuals in the securities markets, including securities exchanges, brokerage firms, dealers, investment advisors, and investment funds. Through established securities rules and regulations, the SEC promotes disclosure and sharing of market-related information, fair dealing, and protection against fraud. It provides investors with access to registration statements, periodic financial reports, and other securities forms through its electronic data-gathering, analysis, and retrieval database, known as EDGAR.

The SEC is headed by five commissioners who are appointed by the president, one of whom is designated as chair. Each commissioner's term lasts five years, but they may serve for an additional 18 months until a replacement is found. The current SEC chair is Gary Gensler, who took office on April 17, 2021.3 To promote nonpartisanship, the law requires that no more than three of the five commissioners come from the same political party.

The SEC is allowed to bring only civil actions, either in federal court or before an administrative judge. Criminal cases fall under the jurisdiction of law enforcement agencies within the Department of Justice; however, the SEC often works closely with such agencies to provide evidence and assist with court proceedings.

https://www.investopedia.com/terms/s/sec.asp

• What Is An Options Sweep?

As stock option trading has become more popular and sophisticated, the jargon associated with options has expanded dramatically. For example, you may have heard traders refer to an “options sweep.” A sweep is typically a large order that is broken into a number of different smaller orders that can then be filled more quickly on multiple exchanges. A sweep order instructs your broker to identify the best prices on the market, regardless of offer size, and fill your order piece-by-piece until the entire order has been filled. These types of orders are especially useful for option traders who prefer speed over the lowest possible price.

https://yahoo.com/.../options-sweep-160559278.html

• What Are Sweep Option Trades?

Sweep trades are typically large orders that are broken into a number of different smaller orders. They are filled much more quickly by being split on multiple exchanges. A sweep order instructs the broker to identify the best prices on the market, regardless of offer size, and fill the order piece-by-piece until the entire order has been filled.

These types of orders are especially useful for option traders who prefer speed over the lowest possible price. Why are these types of trades important? Since sweep trades are typically large blocks, it means that the trader placing the order has some major financial backing. Sweep orders also indicate that the buyer wants to take a position in a hurry, which could imply that he or she is anticipating a large move in the underlying stock’s share price in the very near future.

optionsonar.com/../14-what-are-sweep-option-trades

• Understanding The Sweep-To-Fill Order

The order looks first at price and then at the available liquidity at each price. If a trader needs to sell 100,000 shares and wants to use a sweep-to-fill order, the order will look for the highest available price (usually the best bid price) across all available exchanges, and the amount shares available at that price. If 100,000 are not available for sale, it will then look to the next highest price and the shares available there, and repeat this process until the full order size is able to be filled.

In some heavily traded stocks such an order would not significantly change the price by its execution. However in thinly traded stocks, those that trade less than 100,000 shares per day on average, such an order could create a substantial move down in the stock's price. Consequently brokers and traders are careful about the use of such an order.

It does this until the whole order should be filled, and then sends out individual orders for each price and share amount.While this is similar to a market order in that the order is trying to take all liquidity until the order is filled, a sweep-to-fill order can have a limit attached to it, controlling how far the order searches for liquidity. For example, if a trader has a large position they want to buy, they may want to buy as much as they can but only up to a certain price. They could use a sweep-to-fill order to do this.

Sweep-to-fill order processing is more common with large orders. Retail investors need to specify the use of a sweep-to-fill order if they wish to transact in this way, and not all brokers offer this order type.

investopedia.com/terms/s/sweeptofillorder.asp

• Sweep-To-Fill Order Processing

Sweep-to-fill orders are facilitated by broker-dealers with technology for accessing a broad range of exchanges and trading venues called electronic communication networks (ECNs). In a sweep-to-fill order, a broker-dealer will fill the order at various market prices providing the investor with an average buying price.

Most broker-dealers have technology systems linked to all the major exchanges, electronic communication networks (ECNs), and some may access dark pools as well. When an order is placed, it is sent to all of the exchanges in the broker’s network to grab all the available liquidity, starting at the best price, and taking liquidity at successively worse prices until the order is filled. Alternatively, the order will do the above until the limit price set on the order is reached.

investopedia.com/terms/s/sweeptofillorder.asp

• No Longer a Necessary Order

This order type isn't used much by retail traders. The exchanges are so interlinked, and any exchange or ECN in the U.S. posting a visible order will show up on the order book for that stock. An order cannot be filled at a price outside the best bid or offer. While the bid or offer can change, another one will be shown, and then transactions can't occur outside those levels until all those shares are gone and then a new bid/ask price is revealed.

In this way, any limit or market order will sweep the book, because it takes all shares at the best available price, and then moves to take all the shares at the next best price, and so on, until the order is filled.

That said, some brokers still offer this order type. While most retail investors will find little benefit to it over and above using traditional limit or market orders, some institutional investors may find it incrementally improves their execution price but that is by no means guaranteed. Institutional investors will typically test out order types to see which provides the better execution rate over many trades, and then will gravitate toward the more efficient types.

investopedia.com/terms/s/sweeptofillorder.asp

• Example of a Sweep-To-Fill Order

Assume a trader is interested in buying Ali Baba Inc. (BABA), and wants to get into the trade right now. They want to buy 10,000 shares. The price is oscillating around $160.60, but there is only about 500 shares usually showing on the order book at each price level. Bigger, or smaller, liquidity may pop up at different prices though. A sweep-to-fill order will look at all available liquidity and then send out orders to grab all the available liquidity at the different price levels until the order is filled.

Assume the trader adds in the additional stipulation that they want to limit their buying to $160.70.There are 500 shares posted at $160.61, 1,200 shares at $160.62, 900 at $160.63, 200 at $160.64, 5,000 at $160.65, 500 at $160.66, 1,000 at $160.67, and 2,000 at $161.68.

The sweep-to-fill order looks at all these prices and volumes and then sends out an order for each price and volume amount. It will take all the shares at all the prices until it fills, so it will only take 700 at $161.68 instead of the full 2,000 available. This is because if it gets all the other shares prior, it will reach the 10,000 required shares with only taking 700 at $161.68.

investopedia.com/terms/s/sweeptofillorder.asp

UNAVAILABLE