Batch Auction Definition - Glossary

Batch Auction is a trading method where multiple buy and sell orders are executed simultaneously at a single clearing price.

Batch Auction is a trading mechanism used to execute multiple buy and sell orders at once. It aggregates these orders over a set period and matches them at a single clearing price. This method contrasts with continuous trading, where transactions occur in real-time. Batch auctions can improve liquidity and reduce market volatility by consolidating trades. It enhances price discovery and can be particularly useful in markets with low trading volumes. By executing all trades at a uniform price, it ensures fairness and minimizes price manipulation.