Dark Pool Liquidity

AAA

DEFINITION of 'Dark Pool Liquidity'

The trading volume created by institutional orders that are unavailable to the public. The bulk of dark pool liquidity is represented by block trades facilitated away from the central exchanges.

Also referred to as the "upstairs market," "dark liquidity" or "dark pool."

INVESTOPEDIA EXPLAINS 'Dark Pool Liquidity'

The dark pool gets its name because details of these trades are concealed from the public, clouding the transactions like murky water. Some traders that use a strategy based on liquidity feel that dark pool liquidity should be publicized, in order to make trading more "fair" for all parties involved.

RELATED TERMS
  1. Flash Trading

    A controversial computerized trading practice offered by some ...
  2. Block Trade

    An order or trade submitted for sale or purchase of a large quantity ...
  3. Liquidity

    1. The degree to which an asset or security can be bought or ...
  4. Liquidity Risk

    The risk stemming from the lack of marketability of an investment ...
  5. Volume

    The number of shares or contracts traded in a security or an ...
  6. Upstairs Trade

    A buy or sell transaction for an exchange-listed stock that is ...
Related Articles
  1. Principal Trading and Agency Trading
    Investing Basics

    Principal Trading and Agency Trading

  2. Getting To Know The Stock Exchanges
    Options & Futures

    Getting To Know The Stock Exchanges

  3. A Look At Primary And Secondary Markets
    Investing Basics

    A Look At Primary And Secondary Markets

  4. Understanding Financial Liquidity
    Options & Futures

    Understanding Financial Liquidity

comments powered by Disqus
Hot Definitions
  1. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  2. Odious Debt

    Money borrowed by one country from another country and then misappropriated by national rulers. A nation's debt becomes odious ...
  3. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  4. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  5. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  6. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
Trading Center