Dark liquidity pools

Dark liquidity pools are private alternative trading systems or platforms. Prices aren't published, and participants can make anonymous trades faster and at a lower cost than they can on a public exchange.

Most dark-pool transactions are between institutional investors, including mutual funds and hedge funds, which trade in large volumes. Their interest in anonymity is either because they want to protect the privacy of their investment choices or because they fear a major transaction could move the markets by triggering copycat trading.

Dark liquidity pools must register with the Securities and Exchange Commission (SEC) as either national securities exchanges or broker-dealers. The broker-dealers must follow the rules laid out in SEC Regulation ATS, which governs fair access and a requirement to publish prices for trades in certain securities under specific circumstances.