Skip to main content

Main menu

  • Home
  • Past Issues
  • Videos
  • Submit an article
  • More
    • About the JOT
    • Editorial Board
  • IPR Logo
  • About Us
  • Journals
  • Publish
  • Advertise
  • Videos
  • Webinars
  • More
    • Awards
    • Article Licensing
    • Academic Use
  • Follow PMR on LinkedIn
  • Follow PMR on Twitter

User menu

  • Sample our Content
  • Subscribe Now
  • Log in

Search

  • ADVANCED SEARCH: Discover more content by journal, author or time frame
The Journal of Trading
  • IPR Logo
  • About Us
  • Journals
  • Publish
  • Advertise
  • Videos
  • Webinars
  • More
    • Awards
    • Article Licensing
    • Academic Use
  • Sample our Content
  • Subscribe Now
  • Log in
The Journal of Trading

The Journal of Trading

ADVANCED SEARCH: Discover more content by journal, author or time frame

  • Home
  • Past Issues
  • Videos
  • Submit an article
  • More
    • About the JOT
    • Editorial Board
  • Follow PMR on LinkedIn
  • Follow PMR on Twitter
Primary Article

Principal Bid vs. Agency Trading

Strategies and Costs

Anna Bystrik and Akis Georgiou
The Journal of Trading Fall 2006, 1 (4) 6-13; DOI: https://doi.org/10.3905/jot.2006.654297
Anna Bystrik
Vice president of Miletus Trading in New York, NY.
  • Find this author on Google Scholar
  • Find this author on PubMed
  • Search for this author on this site
  • For correspondence: anna.bystrik@miletustrading.com
Akis Georgiou
Vice president of Miletus Trading in New York, NY.
  • Find this author on Google Scholar
  • Find this author on PubMed
  • Search for this author on this site
  • For correspondence: akis.georgiou@miletustrading.com
  • Article
  • Info & Metrics
  • PDF (Subscribers Only)
Loading

Abstract

In this article we analyze the estimated costs of agency versus principal bid trading. Building on recent academic literature, we analyzed actual program trading costs using data provided to us by a large institutional manager. In general, a principal broker will charge the client a risk premium in return for a guaranteed execution. As both agency and principal brokers have access to similar trading tools and liquidity, the risk premium will usually result in the principal cost being higher than the expected agency cost — a price that may seem worth paying for an individual, zero-risk trade. By analyzing trading costs on an annualized basis (after all, fund returns are measured on an annualized basis), we demonstrate that agency trading can offer significant savings over principal trading.

  • © 2006 Pageant Media Ltd

Don’t have access? Register today to begin unrestricted access to our database of research.

Log in using your username and password

Forgot your user name or password?
PreviousNext
Back to top

Explore our content to discover more relevant research

  • By topic
  • Across journals
  • From the experts
  • Monthly highlights
  • Special collections

In this issue

The Journal of Trading
Vol. 1, Issue 4
Fall 2006
  • Table of Contents
  • Index by author
Download PDF
Article Alerts
Sign In to Email Alerts with your Email Address
Email Article

Thank you for your interest in spreading the word on The Journal of Trading.

NOTE: We only request your email address so that the person you are recommending the page to knows that you wanted them to see it, and that it is not junk mail. We do not capture any email address.

Enter multiple addresses on separate lines or separate them with commas.
Principal Bid vs. Agency Trading
(Your Name) has sent you a message from The Journal of Trading
(Your Name) thought you would like to see the The Journal of Trading web site.
CAPTCHA
This question is for testing whether or not you are a human visitor and to prevent automated spam submissions.
Citation Tools
Principal Bid vs. Agency Trading
Anna Bystrik, Akis Georgiou
The Journal of Trading Sep 2006, 1 (4) 6-13; DOI: 10.3905/jot.2006.654297

Citation Manager Formats

  • BibTeX
  • Bookends
  • EasyBib
  • EndNote (tagged)
  • EndNote 8 (xml)
  • Medlars
  • Mendeley
  • Papers
  • RefWorks Tagged
  • Ref Manager
  • RIS
  • Zotero
Save To My Folders
Share
Principal Bid vs. Agency Trading
Anna Bystrik, Akis Georgiou
The Journal of Trading Sep 2006, 1 (4) 6-13; DOI: 10.3905/jot.2006.654297
del.icio.us logo Digg logo Reddit logo Twitter logo CiteULike logo Facebook logo Google logo LinkedIn logo Mendeley logo
Tweet Widget Facebook Like LinkedIn logo

Jump to section

  • Article
  • Info & Metrics
  • PDF (Subscribers Only)
  • PDF (Subscribers Only)

Similar Articles

Cited By...

  • No citing articles found.
  • Google Scholar

More in this TOC Section

  • Dual Traders in Fully Anonymous Stock Markets, Iceberg Orders, and Liqudity Provision
  • Simulation of Maker Loss in the Global Inter-Bank FX Market
  • Evaluating Algorithmic Performance
Show more Primary Article
LONDON
One London Wall, London, EC2Y 5EA
United Kingdom
+44 207 139 1600
 
NEW YORK
41 Madison Avenue, New York, NY 10010
USA
+1 646 931 9045
pm-research@pageantmedia.com
 

Stay Connected

  • Follow PMR on LinkedIn
  • Follow PMR on Twitter

MORE FROM PMR

  • Home
  • Awards
  • Investment Guides
  • Videos
  • About PMR

INFORMATION FOR

  • Academics
  • Agents
  • Authors
  • Content Usage Terms

GET INVOLVED

  • Advertise
  • Publish
  • Article Licensing
  • Contact Us
  • Subscribe Now
  • Log In
  • Update your profile
  • Give us your feedback

© 2021 Pageant Media Ltd | All Rights Reserved | ISSN: 1559-3967 | E-ISSN: 2168-8427

  • Site Map
  • Terms & Conditions
  • Privacy Policy
  • Cookies