Bunched Orders refer to the aggregation of multiple individual client orders into a single, larger order for execution in the market. In the context of crypto trading, particularly institutional options and RFQ systems, this strategy is employed to achieve operational efficiency, reduce transaction costs, and potentially minimize market impact by executing a consolidated volume rather than many smaller, separate trades.
Mechanism
The operational process for Bunched Orders involves an order management system (OMS) or execution management system (EMS) collecting individual client requests over a specified period or until a certain volume threshold is met. These orders are then combined into a single block order, which is subsequently routed to liquidity providers or exchanges. Upon execution, the aggregated trade is then allocated back to the original client accounts based on their initial order proportions, often utilizing an average price methodology. This mechanism streamlines communication and execution across disparate crypto RFQ venues.
Methodology
The strategic rationale behind Bunched Orders centers on optimizing execution quality and managing costs for institutional participants in crypto markets. By reducing the number of individual transactions, it helps mitigate fees, spreads, and slippage associated with numerous small orders. This methodology is particularly relevant in markets with fragmented liquidity or significant transaction costs, offering a means to execute substantial volumes discreetly and efficiently, thereby supporting sophisticated trading strategies and improved pricing within RFQ frameworks.
We use cookies to personalize content and marketing, and to analyze our traffic. This helps us maintain the quality of our free resources. manage your preferences below.
Detailed Cookie Preferences
This helps support our free resources through personalized marketing efforts and promotions.
Analytics cookies help us understand how visitors interact with our website, improving user experience and website performance.
Personalization cookies enable us to customize the content and features of our site based on your interactions, offering a more tailored experience.
