We all see or hear terms in our day-to-day activities that may be foreign to the business in which we usually engage or it may be a term that is just unfamiliar to us. To provide some clarity to such words or terms, we have a new section for our newsletter where we will introduce a new term and definition in each issue.
Dark pools of liquidity (also dark pools or dark liquidity) are crossing networks that provide liquidity that is not displayed on order books. This is useful for traders who wish to move large numbers of shares without revealing themselves to the open market.
Dark liquidity pools offer institutional investors many of the efficiencies associated with trading on the exchanges' public limit order books but without showing their hands to others. Dark liquidity pools avoid this risk because neither the price nor the identity of the trading company is displayed.
If there is a particular word or phrase you think we should cover, please contact your account manager or Karen Hagan at 603-434-3594.
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