easy · Order Flow Analysis market-mechanics-execution
What is the primary reason that institutional traders often use VWAP or TWAP algorithms for large orders?
- To signal their intentions to other market participants via the order book.
- To minimize market impact and slippage by distributing the order over time.
- To ensure they always buy at the absolute daily low or sell at the high.
- To increase the speed of the tape and trigger retail stop-losses.
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