Block Trading and Information Leakage

Question 1

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What is all-in block price?

Accepted Answer

$20.065

Question 2

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What is the block's dollar shortfall?

Accepted Answer

$3,900

Question 3

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What shortfall is expected on the residual?

Accepted Answer

$3,200

Question 4

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What total shortfall is expected?

Accepted Answer

$7,100

Question 5

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What weighted all-in price follows?

Accepted Answer

$20.071

Question 6

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. If the block price is firm but accepts only the full 60,000, what should be verified first?

Accepted Answer

Authority and uncommitted quantity.

Question 7

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What if a separate child order can still fill 50,000 shares?

Accepted Answer

Free enough shares before committing to the block.

Question 8

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What advantage can the block provide beyond price?

Accepted Answer

Immediate committed size under the stated terms.

Question 9

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. Why report the residual separately?

Accepted Answer

Its fillability and costs can differ.

Question 10

A client must buy 100,000 shares with a $20.10 cap. A firm negotiated block offers 60,000 at $20.06 with a $0.005 per-share fee. The desk expects to work the other 40,000 at $20.08 with no fee. Use $20 as benchmark. What should the client hear before choosing?

Accepted Answer

Firm size, fee, and residual tradeoff.

Question 11

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. What expected cost follows the search plan?

Accepted Answer

$15.2k

Question 12

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. Which plan leads on expected cost?

Accepted Answer

Start now by $1.2k.

Question 13

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. What success probability makes search break even?

Accepted Answer

50%

Question 14

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. If fail cost falls to $17k and odds stay 40%, what expected search cost follows?

Accepted Answer

$13.4k

Question 15

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. What assumption matters most for interpreting the estimates?

Accepted Answer

Realistic block odds and feasible fallback.

Question 16

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. Why set a stop time before searching?

Accepted Answer

It limits delay and preserves fallback time.

Question 17

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. What should trigger ending the search early?

Accepted Answer

Remaining time or price risk breaches set thresholds.

Question 18

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. How should a nonfirm indication affect the calculation?

Accepted Answer

Do not count it as a fill.

Question 19

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. What extra cost might search create beyond wait time?

Accepted Answer

Information exposure from inquiries.

Question 20

An urgent buy can start now at expected cost $14k or search five minutes for a block. Block success odds are 40%. Success costs $8k total. On failure, starting later costs $20k total. Estimates already include fees and delay. What should the post-trade review compare?

Accepted Answer

Observed search time, firm outcomes, and residual cost.

Question 21

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. What size can the desk disclose under the instruction?

Accepted Answer

25,000 shares.

Question 22

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. What should it do before adding a third channel?

Accepted Answer

Obtain the required authorization.

Question 23

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. Why record exactly what each inquiry revealed?

Accepted Answer

To evaluate exposure and investigate outcomes.

Question 24

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. What is a benefit of limiting simultaneous outreach?

Accepted Answer

Fewer parties see the same interest at once.

Question 25

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. Can a counterparty infer more than the disclosed clip?

Accepted Answer

Yes, from repeated requests and behavior.

Question 26

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. What does the desk owe the client if more size is requested by a channel?

Accepted Answer

Follow the permitted scope or seek authority.

Question 27

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. What if the client also prohibits discussing urgency?

Accepted Answer

Keep the inquiry within that restriction.

Question 28

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. Which evidence would justify narrowing outreach next time?

Accepted Answer

Rising adverse moves with low firm response across comparable searches.

Question 29

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. Why keep an approved alternative to solicitation?

Accepted Answer

The desk can switch if outreach costs outweigh benefits.

Question 30

A client permits the desk to seek a block through two approved channels. It permits disclosing side and a 25,000-share clip, but not the 200,000-share parent. Each inquiry can be tracked. What should be emphasized in the client recap?

Accepted Answer

Terms disclosed, firm outcomes, and remaining plan.

Question 31

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. What is parent residual?

Accepted Answer

110,000

Question 32

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. What quantity is currently uncommitted?

Accepted Answer

60,000

Question 33

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. Can the firm 75,000 block be accepted now under the parent cap?

Accepted Answer

No, it exceeds free size.

Question 34

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. If the 20,000 cancel confirms with no fills, what free size follows?

Accepted Answer

80,000

Question 35

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. After that cancel, accepting the 75,000 block leaves how much free before any other fills?

Accepted Answer

5,000

Question 36

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. If the live 30,000 then fills in full and the block confirms, what remains?

Accepted Answer

5,000

Question 37

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. What if the block is only an indication?

Accepted Answer

Verify firm terms before relying on it.

Question 38

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. Why not accept conditional blocks with multiple brokers on the same size?

Accepted Answer

Simultaneous commitments can create duplicate execution risk.

Question 39

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. What should happen if a late fill exceeds the intended balance?

Accepted Answer

Escalate promptly and reconcile the facts.

Question 40

A 150,000-share sell has 40,000 confirmed fills. A 30,000-share child remains live, and a 20,000-share child awaits cancel. A broker offers a firm 75,000 block that cannot be split. Which records explain the final balance?

Accepted Answer

Confirmed execution, cancel, and block commitment times.

Question 41

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. What simple market-adjusted midpoint move is observed?

Accepted Answer

−10 bp

Question 42

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. Does the residual establish leakage by itself?

Accepted Answer

No.

Question 43

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. What data helps test the hypothesis?

Accepted Answer

Inquiry timestamps, disclosure scope, and matched controls.

Question 44

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. Why check whether the price began moving before 11:00?

Accepted Answer

Pre-trends can confound attribution.

Question 45

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. Which comparison addresses the stock's normal sensitivity to the sector?

Accepted Answer

An estimated beta or a better matched control.

Question 46

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. If beta to the basket is 1.2, what simple residual follows?

Accepted Answer

−4 bp

Question 47

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. What if the desk also sold aggressively during the minute?

Accepted Answer

Consider its own impact.

Question 48

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. What should the report say if evidence is inconclusive?

Accepted Answer

State observed moves and competing explanations.

Question 49

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. Which control change is testable next time?

Accepted Answer

Narrow outreach for matched orders and monitor results.

Question 50

A desk seeks sell block liquidity at 11:00. The stock midpoint falls 40 bp over the next minute. A matched sector basket falls 30 bp. Comparable unqueried stocks are available for more analysis. What outcomes should that test measure together?

Accepted Answer

Firm responses, completion, and subsequent price moves.

Question 51

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. What net per share does the block deliver?

Accepted Answer

$49.89

Question 52

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. What total net proceeds does the block deliver?

Accepted Answer

$1,995,600

Question 53

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. What weighted price follows sweeping displayed bids?

Accepted Answer

$49.88

Question 54

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. How much more does the block deliver than sweeping?

Accepted Answer

$400

Question 55

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. What would make the displayed route preferable on cost at smaller size?

Accepted Answer

The top bids may cover that smaller amount.

Question 56

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. Which variable changes if bids may disappear before the router arrives?

Accepted Answer

Expected executable depth.

Question 57

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. Why verify firm block conditions?

Accepted Answer

Minimum size, expiry, and eligibility can bind.

Question 58

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. What if block settlement differs from the client's requirement?

Accepted Answer

Check eligibility and alternatives.

Question 59

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. What additional cost could the sweep cause beyond displayed results?

Accepted Answer

Price movement during execution.

Question 60

A sell can execute a firm 40,000-share block at $49.90 and pay a $0.01 fee. Visible bids are 10,000 at $50, 10,000 at $49.92, and 20,000 at $49.80 with no fees. Assume displayed sizes are firm for the calculation. What should the desk compare at its decision time?

Accepted Answer

Net executable proceeds and certainty at required size.

Question 61

A desk has a 120,000-share buy and 20 minutes left. It is allowed to search for a block for at most five minutes. Continuous fallback can do 5,000 shares per minute. Assume constant capacity and no block search fills unless a firm trade occurs. How much can fallback execute if started now?

Accepted Answer

100,000

Question 62

A desk has a 120,000-share buy and 20 minutes left. It is allowed to search for a block for at most five minutes. Continuous fallback can do 5,000 shares per minute. Assume constant capacity and no block search fills unless a firm trade occurs. What fallback capacity remains after five minutes?

Accepted Answer

75,000

Question 63

A desk has a 120,000-share buy and 20 minutes left. It is allowed to search for a block for at most five minutes. Continuous fallback can do 5,000 shares per minute. Assume constant capacity and no block search fills unless a firm trade occurs. What block size is needed to finish after the full search window?

Accepted Answer

45,000

Question 64

A desk has a 120,000-share buy and 20 minutes left. It is allowed to search for a block for at most five minutes. Continuous fallback can do 5,000 shares per minute. Assume constant capacity and no block search fills unless a firm trade occurs. If only a 30,000 block trades after five minutes, what residual stays at the deadline?

Accepted Answer

15,000

Block Trading and Information Leakage

Firm size versus price

Time spent searching

Limited disclosure

Overlapping interests

Adverse move after inquiry

Negotiated price and depth

A staged fallback

Price marks after fills

Searching baskets

Evaluating a search policy