Anonymous Trading
Definition of 'Anonymous Trading'Bids and offers that are visible on the market but which do not reveal the identity of the bidder and seller. Anonymous trades allow high-profile investors to execute transactions without the scrutiny and speculation of the market. Anonymity is attractive to investors who want to complete large transactions without drawing attention to their trades, since such attention could impact market prices. The London Stock Exchange provides a platform that facilitates anonymous trading. |
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Investopedia explains 'Anonymous Trading'Dark pools are trading venues that are similar to anonymous trading platforms in that they also involve anonymity, large trades and the desire to avoid a significant price impact. However, dark pools do not trade through exchanges and their orders are anonymous only before and during execution, but not after. Institutional investors commonly use dark pools to avoid increasing the price of a security when placing a large buy order. |
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