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Aggregate Trading: Issues and Implications

Wisebitcoin 2021-04-26

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Here we talk about what aggregate trading is, what implications it has on the market and liquidity, and how Wisebitcoin can provide investors with a holistic view of their assets and one-tap access to accounts to leverage available trade and investment opportunities.

Trade aggregation (also known as trade bunching or blocking) is the process of combining orders of the same security or asset (whether those are purchase orders or sell orders) into one large order. It is sometimes done to lower the administrative overheads associated with trades, to lower order execution costs, and enjoy the lower commission rates that are usually associated with larger orders.

Aggregate trading figures provide investors with a useful indicator of the market liquidity of a stock, asset, or security. Higher average aggregate trading volumes over a long time are indicative of higher liquidity.

Financial advisors often use trade aggregation tools to gather information on the various positions that their retail investors have in different accounts. This information, once aggregated across many investors and many different banks, funds, or other investment platforms can provide an accurate assessment of the overall market’s position toward a tradeable asset without disclosing private or identifiable information about any given individual or entity.

Aggregate trading figures can be used to analyze a client’s assets, liabilities, and net worth, as well as his or her income, expenses, and portfolio risk.

Since aggregate orders tend to be larger than the average order size on any given exchange, we often see aggregated trade orders being partially filled. This simply means that only part of the order has been filled.

There are very specific SEC and compliance rules that must be followed when performing aggregate trades. For example, according to the SEC, trade aggregation does not violate any anti-fraud laws, but only if trade aggregating is fully disclosed to all existing clients and one account is not favored over any other when executing or blocking trades. Furthermore, all of the clients who participate in an aggregated order must be charged or receive the average price of the order and all transaction costs must be shared proportionally amongst all participants. Thus, the key concepts that govern aggregate trading are fairness to clients, having adequate disclosures, and having a clearly defined and systematic approach to allocating trade orders.

 

Aggregate Trading and Wisebitcoin

Wisebitcoin is a cloud-based cryptocurrency exchange that connects over 12 million end-users to a wide range of cryptocurrency trading pairs and related DeFi investment opportunities. Wisebitcoin provides deep liquidity to cryptocurrency exchanges and traders and maintains a stable and secure trading environment in volatile crypto markets.

With native mobile apps and a very user-friendly platform that is designed to accommodate worldwide crypto traders with a wide range of professional-grade trading services such as spot and futures trading, Wisebitcoin is proud to guarantee an unprecedented level of liquidity that is needed for avid crypto traders.

As a cloud service, Wisebitcoin can connect you to a unique network of roughly 280 cryptocurrency exchanges that enjoy a combined daily trading volume of over $6.35 billion, as well as custodial assets of over $6 billion. This level of liquidity is crucial for advanced trades such as aggregate trading to be successful, but it ensures that traders can enjoy the lower transaction costs and administrative overheads that come with larger orders.

If you are a seasoned cryptocurrency trader, want to learn more about Wisebitcoin’s institutional-grade trading services, or are ready to just get started with your first online trade, we invite you to register with us by visiting Wisebitcoin. Registration takes one minute and connects you to a vast world of cryptocurrency trading and investment opportunities and a wide range of decentralized finance products that can give you the peace of mind and financial independence you desire.