An algorithm setting that trades a fixed share of whatever volume actually prints, speeding up in active markets and pausing in quiet ones.
POV is adaptive where twap-algo and vwap-algo are scheduled. You set 10% and the algo does its best to be one in every ten shares traded, with no promise about when it will finish.
Higher rates finish sooner and cost more in market-impact. Research and trading-desk rules of thumb both put the practical ceiling around 20-25% of volume before the order starts moving the price against itself.
Example: at 10% participation in a stock trading 3 million shares a day, you can expect roughly 300,000 shares done. If the day turns quiet and only 1 million trade, you finish 100,000 and carry the rest — which is why POV orders usually carry a "must complete" override.
Original diagrams for the ideas on this page. Illustrative, not real market data.
VWAP and its standard-deviation bands. VWAP is the day's average price weighted by how much volume traded at each price, so it shows where the bulk of the day's business was done. The bands sit one standard deviation either side, and price here swings between them all session.Contango and backwardation. A futures curve shows what buyers will pay for delivery in one month, two months and so on. When later contracts cost more than the spot price the curve is in contango; when they cost less it is in backwardation.
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