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A private trading venue where large orders are matched without being shown publicly.
Why It Matters
Dark pools let big institutions trade large blocks without revealing their intentions to the whole market. If a fund tried to sell a million shares on a public exchange, the visible order would move the price against it; a dark pool hides the order until it's matched, reducing that impact. Most individual investors don't interact with dark pools directly, but they're a meaningful part of overall market structure and where a chunk of total volume trades.
Key Points
- A private venue that hides large orders
- Reduces the price impact of big block trades
- Mostly used by institutions, not retail
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Common Questions
A private trading venue where large orders are matched without being shown publicly. Dark pools let big institutions trade large blocks without revealing their intentions to the whole market. If a fund tried to sell a million shares on a public exchange, the visible order would move the price against it; a dark pool hides the order until it's matched, reducing that impact.
Dark pools let big institutions trade large blocks without revealing their intentions to the whole market. If a fund tried to sell a million shares on a public exchange, the visible order would move the price against it; a dark pool hides the order until it's matched, reducing that impact. Most individual investors don't interact with dark pools directly, but they're a meaningful part of overall market structure and where a chunk of total volume trades.
A private venue that hides large orders
Reduces the price impact of big block trades
Mostly used by institutions, not retail