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Please elaborate. If an order makes it to an exchange and that exchange has a bunch of small orders at all times, how is the retail-ness of the order relevant a
by MichaelGG 11y ago
Please elaborate. If an order makes it to an exchange and that exchange has a bunch of small orders at all times, how is the retail-ness of the order relevant at all?
I understand that at other parts of the order chain this might matter. But inside the matching engine there isn't "retail priority".
- HiLo 11y agoInside the matching engine, there's a sitting limit order on the limit order book flagged as a retail order, just off the bid/ask. Whereas you may not have taken the other side of that resting order before, you might now because you know it has extra informational value attached. Dealers will pay exchanges for the right to access this information, either outright or in reduced liquidity rebates they would normally otherwise receive (normally outright to my understanding).