Music Plus
Wong follows the music industry and, specifically, Music Plus. After highly anticipated data about the music industry is released shortly after the market opens for trading, the share price of Music Plus quickly increases to $15.25. Wong evaluates the new data as it relates to Music Plus and concludes that the share price increase is an overreaction. She expects the price to quickly revert back to her revised fair value estimate of $14.20 within the same day. When the price is $15.22, she decides to prepare a large sell order equal to approximately 20% of the expected daily volume. She is concerned about information leakage from a public limit order. Wong’s supervisor suggests using algorithmic trading for the sell order of the Music Plus shares.
The most appropriate trading strategy for the sell order of Music Plus shares is:
A trading in the open market.
B selling at the closing auction for the day.
C passive trading over the course of the trading day.
答案A
为什么选择A？
The trade algorithm that Wong should consider for the sell order of Music Plus shares is:
A a POV algorithm.
B an arrival price algorithm.
C a liquidity-seeking algorithm.
答案C
这里如何理解文中说prepare the sell order=20% of ADV？
