Discretion

Discretion introduces controlled randomness into order execution, making trading patterns less predictable and reducing the risk of detection by other market participants. This setting adjusts the balance between passive execution for better pricing and aggressive execution for closer benchmark tracking.

How It Works

• Higher discretion – Orders rely more on passive fills, leading to better pricing but greater variance from the benchmark.

• Lower discretion – Orders track the benchmark price more closely but increase reliance on market orders, potentially raising execution costs.

Considerations

Discretionary Band with High Discretion

High Discretion (e.g., 0.2) – More Passive Fills, Higher Benchmark Variance

• Optimizes for better pricing by favoring limit orders.

• Works well with Post-Only mode, helping reduce taker fees.

Discretionary Band with Low Discretion

Low Discretion (e.g., 0.04) – Closer Benchmark Tracking, More Aggressive Execution

• Prioritizes staying close to the benchmark with faster execution.

• Relies more on taker orders, increasing execution costs.

This setting allows traders to fine-tune execution behavior, balancing cost efficiency, order visibility, and benchmark tracking.