What term denotes the disclosure of trading information before trades are executed?

What term denotes the disclosure of trading information before trades are executed?

• A. Pre-trade transparency
• B. Post-trade transparency
• C. On-Book matching
• D. Layer 2 connection

Answer: (A)

Pre-trade transparency is the visibility of trading information before trades are executed. This means seeing current bid and ask prices and how much quantity is available at each price level in the order book. Such visibility helps traders judge liquidity and expected execution quality before placing an order. After a trade happens, the information becomes post-trade transparency, which reporting the actual trade prices and volumes. The other terms aren’t about the timing of information disclosure: On-Book matching refers to how orders are matched in the central order book, and Layer 2 connection is a networking term.

Pre-trade transparency is the visibility of trading information before trades are executed. This means seeing current bid and ask prices and how much quantity is available at each price level in the order book. Such visibility helps traders judge liquidity and expected execution quality before placing an order. After a trade happens, the information becomes post-trade transparency, which reporting the actual trade prices and volumes. The other terms aren’t about the timing of information disclosure: On-Book matching refers to how orders are matched in the central order book, and Layer 2 connection is a networking term.