i thought it asked what volume was gonna go through at the next crossing jogaut you’re taking this a little too personally
this was a strange question for me…i put 50k
The question asked what “BLOCK WILL BE EXECUTED” not how many stocks will be sold. if it was later the majority is right which is 70k - but if my memory serves me right- they asked the block …
Nothing personal Super. Just trying to have a little fun here. You may not call this question controversial Ali but people are talking about it, which tells me that there was some confusion. Unless you have the full text of the question in front of you its hard to say either way with absolute certainty. In the end, who cares, it was only one question.
I put 70, just figured the way most put here. It seems even if I guessed wrong, most will go down with me on this one.
Would it be the case that people in APAC has a slightly modified number which led to 50 and people in Europe and Americas had diff exam set that led to 70 K?
i chose 70,000
Im with chowder on this one…50k. It only indicated what would be the first amount to be executed.
I am a trading expert. 70k The trade execution go by time priority of order input. The 1st sell order will eat up all the buy orders (70k).
First chunk to go out is 50k, I see it every day.
^^ I think it’s different for external order crossing. (ECN) The crossing will only be done a few times or once a day. All the 4 orders will be matched during that specific time. Earlier order will be matched 1st. But the trades would be consolidated. (it means that after the crossing time, 70000 in the sell orders would be matched by the 50000 and 20000) I maybe wrong on this actually. Different ECN may do it differently?
But the order was for 80k shares, where does the 70k come from? Assuming it was an auction market, like open price or resume after suspension, then yes many orders will be matched at once and exceuted at some weighted price, not necessarily the highest bid or lowest ask. But I thought the question was talking about typical ECN trading, nothing about auction or open price calculation.
All 4 orders (in order of time priority) were (if i remember correctly and question set: 6***) Order 1: Buy 50000 Order 2: Sell 80000 Order 3: Sell 10000 Order 4: Buy 20000 ECN processed 1st cross: Order 2: Sell 30000 Order 3: Sell 10000 Order 4: Buy 20000 ECN processed 2nd cross: Order 2: Sell 10000 Order 3: Sell 10000 So Order 2 will have 70000 executed and left 10000 with no cross. Anyways, I maybe wrong also if CFAI meant that the 1st trade means the 1st cross only, rather than consolidated together.
doesn’t as much cross order happen at the same time? ie it will try to match all of the orders as much as it can doesn’t crosses happen at predetermined time of a day or is that a different system?
50K makes no sense. “How many shares of the 80,000 sell order will be traded in the next crossing session” 100% certain that 70k would be, the 80k sell order has priority over the following sell order of 10,000, and there was 70,000 total buy. Don’t think this one is close to debatable, What block will be traded ? 50,000 ? doesn’t make sense.
Yeah, a crossing network queues up all the orders, then at a crossing session, fills them in the order received at the crossing price. Share by share, they match the first received buy with the first received sell… then move down the line. Its 70,000.
People must be writing different tests, because this one seemed straightforward. I think the heart of the question was, if 2 buy orders are in place, does the first take precedence. And I think that indeed it does.
I put 70 because my exam said ‘at the next crossing session’ which to me implied that the orders que up in order of time at which they were received and when the crossing session starts the temporal nature of the orders is preserved, i.e. a FIFO system if you will whereby the first buy has to be executed in full before subsequent buys are filled, since the total sells on the book for the given crossing session only totaled 70 (and our buy was 80) this trade order soaked up the full volume of sell orders that were on the book for the given crossing session (i.e. 70). I am not sure if I am right but this was my reasoning when I answered, I certainly didn’t remember this material from having read the materials.