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In Which Market Conditions Is an RFQ Platform Generally Preferred over a CLOB for Institutional Options Trading?

Preferred for large block sizes, illiquid/customized options, and when minimizing market impact and seeking price discretion is key.
Greeks.Live13.11.25

In Which Market Conditions Is an RFQ Platform Generally Preferred over a CLOB for Institutional Options Trading?

RFQ platforms are preferred when institutions are trading large block sizes, seeking customized or illiquid options, or want to minimize market impact. Large orders can move the price significantly on a transparent CLOB, whereas an RFQ allows the trader to privately solicit competitive quotes from multiple dealers.

This discretion and ability to negotiate complex terms make RFQ ideal for bespoke and size-sensitive institutional options trades.

What Is ‘Time-Weighted Average Price’ (TWAP) and When Is It Preferred over VWAP?
Why Are Limit Orders Generally Preferred for Trading Highly Illiquid Financial Derivatives?
Are There Hybrid Models That Combine Features of CLOB and RFQ Systems?
Why Are ‘Request for Quote’ (RFQ) Systems Used Instead of Order Books for Some Derivatives?

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