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Basket Trade |
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Basket Trade 1. A single order or trade in 15 or more securities, especially in large amounts. Basket trades can be open orders in which the computer is instructed to wait until a certain price prevails before buying or selling the large quantity of securities. This is a service offered exclusively to institutional investors and high net-worth individuals. 2. A large trade executed automatically by a computer on behalf of institutional investors. Basket trades are usually open orders in which the computer is instructed to wait until a certain price prevails before buying or selling the large quantity of securities. Because of the large number involved, basket trading may lead to increased market volatility; because of this, it has been blamed for the 1987 Stock Market Crash, because the computers sold automatically as prices were reached, which made the problem worse. Exchanges now limit the times when basket trades may occur to prevent a recurrence. They are also called program trades. See also: Algorithmic trading. How to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit webmaster's page for free fun content. |
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Preferred which employs 100 staff is an established self-clearing broker-dealer offering option, stock, futures, and basket trade executions for individual customers, option floor traders, and money management institutions. Block Trades, Basket Trades and many more features -- Direct Access Trading Platform -- Customizable Desktop -- Public Company Fundamental Data including Tear Sheet, History, PDF Reports, etc. We found that some traders were so impressed with our execution quality for basket trades that they started using the system for single-stock orders," said Randy Abernethy, Co-founder and Chief Technology Officer of UNX. |
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