market architecture of selected stock exchanges in ... - Gilles Daniel
market architecture of selected stock exchanges in ... - Gilles Daniel
market architecture of selected stock exchanges in ... - Gilles Daniel
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61accord<strong>in</strong>g to price/time priority and provides full transparency, display<strong>in</strong>g all ordersbefore trade <strong>in</strong> real time. After trade, BOVESPA dissem<strong>in</strong>ates all <strong>market</strong> dataassociated with these trades through its <strong>market</strong> data feed facility.Order and Offer TypesAt BOVESPA, there are different order types through which clients order abrokerage firm to buy or sell assets. These orders have to be <strong>in</strong> accordance with oneor more <strong>of</strong> the follow<strong>in</strong>g types (Table 28). Furthermore, traders for a certa<strong>in</strong>brokerage firm place bid or ask <strong>of</strong>fers, through which they show their <strong>in</strong>tention tobuy or sell assets or rights attached to them under conditions specified by the client.Alongside <strong>market</strong> and limit orders, and limit <strong>of</strong>fers, the BOVESPA accepts severalothers.Table 28: Order and Offer Types at BOVESPAOrder TypesOffer TypesManagedOrdersThe <strong>in</strong>vestor specifies only the amount and thecharacteristics <strong>of</strong> the securities or rights hewishes to buy or sell. The execution <strong>of</strong> theorder will depend on the brokerage firm’sdiscretion.The bid or ask <strong>of</strong>fer is to be executed at theopen<strong>in</strong>g price <strong>of</strong> an auction or pre-open<strong>in</strong>g andpre-clos<strong>in</strong>g phase.Open<strong>in</strong>gPrice OfferDiscretionaryOrdersF<strong>in</strong>anc<strong>in</strong>gOrdersThe manager <strong>of</strong> a securities portfolio or anagent represent<strong>in</strong>g more than one clientdeterm<strong>in</strong>es the conditions, under which theorder is to be executed. Once executed, theorder placer will <strong>in</strong>dicate the name <strong>of</strong> the<strong>in</strong>vestor (or <strong>in</strong>vestors), the amount <strong>of</strong> <strong>stock</strong>s,and/or securities to be attributed to each <strong>of</strong>them, and the price.The <strong>in</strong>vestor requests the purchase or sale <strong>of</strong> asecurity or a right on a certa<strong>in</strong> <strong>market</strong> and,simultaneously, the sale or purchase <strong>of</strong> thesame security or right on the same <strong>market</strong> oron another BOVESPA managed <strong>market</strong>, witha different settlement date.This type <strong>of</strong> <strong>of</strong>fer is only available for thecont<strong>in</strong>uous trad<strong>in</strong>g phase and is to be fullyexecuted regardless <strong>of</strong> the execution price (nolimit price).This <strong>of</strong>fer is based on a certa<strong>in</strong> trigger price; atthis price and above for a bid <strong>of</strong>fer and at thisprice or below for an ask <strong>of</strong>fer. A stop limit<strong>of</strong>fer becomes a limit <strong>of</strong>fer as the trigger priceis reached.Offer at any PriceStop OfferTrigger PriceStopOrdersThe client specifies the price <strong>of</strong> an asset orright, which must be reached for the order tobe executed.This type <strong>of</strong> <strong>of</strong>fer to be executed at the bestlimit <strong>of</strong> the <strong>of</strong>fsett<strong>in</strong>g price on the <strong>market</strong>when it is registered.MarketOfferMatchedordersThe execution <strong>of</strong> the order is connected to theexecution <strong>of</strong> another order from the sameclient.Simultaneous registration <strong>of</strong> two crossed<strong>of</strong>fers registered by the same brokerage firm.DirectOffer
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