Solution to Qt 8:
For a BUY order: Estimated implicit costs = Trade size x (Trade price - benchmark price)
For a SELL order: estimated implicit costs = trade size x ( benchmark price - trade price)
How can a sell order that was executed above the benchmark price be an implicit cost? If benchmark is 538 and I execute trade for 550, its a benefit of 12 for me right? why is it a cost?
Solution to Qt 9:
This now says that for a sell order, the broker would check whether sale price is above benchmark price for a positive comparison to benchmark. This apparently makes more sense but is this at conflict to the formula for estimated implicit costs?
What am i missing here?
For a BUY order: Estimated implicit costs = Trade size x (Trade price - benchmark price)
For a SELL order: estimated implicit costs = trade size x ( benchmark price - trade price)
How can a sell order that was executed above the benchmark price be an implicit cost? If benchmark is 538 and I execute trade for 550, its a benefit of 12 for me right? why is it a cost?
Solution to Qt 9:
This now says that for a sell order, the broker would check whether sale price is above benchmark price for a positive comparison to benchmark. This apparently makes more sense but is this at conflict to the formula for estimated implicit costs?
What am i missing here?
Thanks Sachin!