In a CLOB auction, if two Limit orders cross (Limit vs Limit) and are matched, what is the resulting price?

In a CLOB auction, if two Limit orders cross (Limit vs Limit) and are matched, what is the resulting price?

• A. RP
• B. Limit
• C. Arithmetic mean
• D. >Limit

Answer: (C)

The price for two crossing limit orders in a CLOB auction is the arithmetic mean of their limit prices. When a buy limit and a sell limit cross, there’s an overlap between what the buyer is willing to pay and what the seller is willing to accept. Using the midpoint between the two limits provides a fair, neutral execution price that satisfies both constraints. For example, if the buyer’s limit is 100 and the seller’s limit is 90, the trade would occur at 95. If both limits are the same, the price is that same value. This avoids favoring one side and keeps the trade within the bounds each party has stated.

The price for two crossing limit orders in a CLOB auction is the arithmetic mean of their limit prices. When a buy limit and a sell limit cross, there’s an overlap between what the buyer is willing to pay and what the seller is willing to accept. Using the midpoint between the two limits provides a fair, neutral execution price that satisfies both constraints. For example, if the buyer’s limit is 100 and the seller’s limit is 90, the trade would occur at 95. If both limits are the same, the price is that same value. This avoids favoring one side and keeps the trade within the bounds each party has stated.