: Execute immediately at the current best price but consume liquidity.
: Trading has shifted from manual floors to electronic matching engines. Algorithms now make real-time decisions on where and when to execute orders to capture minute price discrepancies. Market Microstructure in Practice
Professional market participants use sophisticated tools to navigate these mechanics. : Execute immediately at the current best price
: The gap between the highest bid and lowest ask price represents the immediate cost of trading. Wide spreads often indicate lower liquidity or higher risks, such as asymmetric information where some traders have better data than others. Market Microstructure in Practice
In practice, the efficiency of a market is dictated by its internal dynamics and the behavior of its participants.