How Do ‘Internalizers’ Differ from Traditional Dark Pools?

Internalizers are broker-dealers who execute client orders internally against their own inventory, rather than sending them to an exchange or a third-party dark pool. They essentially 'internalize' the flow.

Traditional dark pools are alternative trading systems (ATS) that match client orders from multiple firms anonymously. Both offer non-public execution, but internalizers focus on matching retail flow against their own principal capital, whereas dark pools are typically agency-based matching venues.