Learning Outcome Statements

a. explain the components of execution costs, including explicit and implicit costs;
b. calculate and interpret effective spreads and VWAP transaction cost estimates;
c. describe the implementation shortfall approach to transaction cost measurement;
d. describe factors driving the development of electronic trading systems;
e. describe market fragmentation;
f. distinguish among types of electronic traders;
g. describe characteristics and uses of electronic trading systems;
h. describe comparative advantages of low-latency traders;
i. describe the risks associated with electronic trading and how regulators mitigate them;
j. describe abusive trading practices that real-time surveillance of markets may detect.