easy · Market Microstructure lob
Which of the following describes a 'Penny Jump' in a market with a 0.01 minimum tick size and FIFO priority?
- Placing an order 0.01 better than the current best bid to gain price priority.
- Cutting the posted spread in half specifically to attract more order flow.
- Placing a passive limit order 0.01 behind the current best bid simply to wait for a fill.
- Executing a cross trade exactly at the midpoint of the prevailing NBBO quoted price.
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