Traders Magazine
By Abhishek Kundu, Managing Director and Head of Quantitative Analytics, Clearpool
Since 2012, the market has seen a steady, prolonged and, at times, pronounced increase in the rate of odd lot trades as a percentage of overall trades (Odd Lot Rate %). What’s driving the increase in odd lot trading, and can we quantify the impact?
Although the rate of odd-lot trading is growing, it remains a small component of overall trading volume (Odd Lot Volume %). Throughout 2020, odd lots consistently represented around 12% of the overall market volume. While it’s not a huge number, it’s relevant enough that the SEC ruled to add odd lots to the SIP as part of core data.