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Why Is Discretion Important for Institutional Traders Executing Large Block Trades?

Discretion prevents market impact and front-running by concealing large trade intentions from the public market.
Greeks.Live14.11.25

Why Is Discretion Important for Institutional Traders Executing Large Block Trades?

Discretion, or the ability to trade without immediately revealing one's intention to the broader market, is crucial for institutional traders. Executing a large block trade publicly on a CLOB can signal market direction, causing other traders to front-run the order and move the price against the institution.

This market impact results in negative slippage. RFQ platforms provide discretion by allowing the trader to only reveal their intent to selected, trusted liquidity providers.

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