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BEING SMART IN DARK

AND LIT MARKETS

SABRINA GAGLIOTTA, HEAD OF EQUITY

PRODUCT

NOVEMBER 13, 2012

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Traders need to change quickly when an opportunity arises

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But also avoid costly errors

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4

» What traders need in order to anticipate better and react faster

1. Clear actionable market data analysis

2. Less steps for order modification

3. Execution transparency

STEPS TO IMPROVED PERFORMANCE:

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51. ACTIONABLE MARKET DATA ANALYSIS

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2. INCREASING RESPONSE SPEEDS: DECREMENTATION

» Traders should not have to cancel orders

• If an algorithm is already running on a stock, DMA orders should automatically deduct from the algorithm’s total quantity

• If a trader needs to change an algorithm, they should not lose their queue position or have to cancel orders

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Sometimes opportunities to gain an edge happen in the dark

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PASSIVEMID

NORMALAGGRESSIVE

2. INCREASING RESPONSE SPEED: ONE CLICK STRATEGY MODIFICATION

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3. REAL-TIME EXECUTION TRANSPARENCY: SEE WHERE YOU ARE GOING

DARK

LIT

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10THE EVOLUTION OF TRADER BEHAVIOR

MANUALLimitMarket

AUTOMATICTWAPVWAP

Arrival PriceVolume

PADDLE SHIFTING Dynamic DMA Orders

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This communication is directed only to market professionals who are eligible to be customers of the relevant Bloomberg Tradebook entity. Communicated, as applicable, by Bloomberg Tradebook LLC; Bloomberg Tradebook Europe Limited, authorized and regulated by the U.K. Financial Services Authority; Bloomberg Tradebook (Bermuda) Ltd.; Bloomberg Tradebook Services LLC. Please visit http://www.bloombergtradebook.com/pdfs/disclaimer.pdf for more information and a list of Tradebook affiliates involved with Bloomberg Tradebook products in applicable jurisdictions. Nothing in this document constitutes an offer or a solicitation of an offer to buy or sell a security or financial instrument or investment advice or recommendation of a security or financial instrument. Bloomberg Tradebook believes the information herein was obtained from reliable sources but does not guarantee its accuracy.

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