tango_gs

goodman2011 Wrote:
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in the reading44
They are valuable from an opportunity cost standpoint against other algo strategies.
This question is taken far out of context comparing it to other methods.
EOC 18 uses ECN and Broker/Principal to trade a block order.
“The trader should use an implementation shortfall strategy to control the risk of this rebalance. In short, he should minimize explicit costs by waiting for trades to cross in an electronic crossing network, such as the POSIT trading system, but he should also submit names not likely to cross to a broker in order to minimize opportunity costs.”
I guess the answer is all of the above except for VWAP.

onelife1

With a portfolio trade, you want liquidity and fast execution. If one of the stocks in the basket is illiquid, then you probably won’t be able to execute the portfolio trade. You also don’t want your trade seating there forever.
So I’ll go with C - Principal Trade.