Small Trades11 Nov 2025 15:45
Interesting from PRE board. I know we've done this to death but this is one i understand....
"Many small trades on SETSqx for AIM stocks are a sign of market makers and investors submitting orders into a periodic electronic auction to trade less liquid securities. It means the market is transitioning from its default quote-driven system to an auction-based execution, and these small orders are the collective effort of traders looking to execute at a common price during specific times of the day, which can indicate an active period of buying and selling activity.
What these trades indicate
Auction activity: Many small trades suggest that a SETSqx electronic auction is taking place. Unlike the continuous trading on the SETS system, SETSqx stocks trade in scheduled auctions (e.g., at 8:00, 9:00, 11:00, 14:00, and 16:35) to consolidate liquidity.
Price discovery: The numerous small orders are part of the process to find a single, "uncrossed" price at which buyers and sellers are willing to transact.
Liquidity: Seeing many small trades can show that the auction is being used effectively to provide liquidity in an otherwise less active market.
Trading behavior: It can reflect a variety of trading strategies, from individual investors placing orders to larger market makers executing against their own quotes or client orders, Investors' Chronicle and aim-watch.com note.
How the system works
Hybrid model: SETSqx combines a traditional quote-driven market (where market makers provide buy and sell prices) with a periodic order book auction.
Trading periods: For much of the day, you see quote-driven trading. However, during the specific auction times, buyers and sellers can submit their bids and offers into an electronic order book.
Aggregation: The many small trades are not individual, isolated events but a collective activity during the auction window, which culminates in a single trade price for all parties that can be executed at that price, Investors' Chronicle and aim-watch.com explain."