Institutional investors use block trades to buy or sell large securities quantities off-exchange, minimizing market disruption. These private, negotiated deals involve shares worth millions, bypassing public order books for speed and discretion. Pension funds, mutual funds, and hedge funds benefit most, executing massive portfolio shifts efficiently while avoiding slippage. Investment banks facilitate these transactions, earning fees while providing liquidity. This mechanism is crucial for major stakeholders managing substantial positions without triggering volatile price swings.
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