Lit Pool

A lit pool is a public financial market or exchange where trade orders are visible to the market participants before being executed. In lit pools, traders can see the depth of the market, including the bid and ask prices for assets, providing transparency and price discovery. Most traditional exchanges, such as the New York Stock Exchange (NYSE), operate as lit pools, allowing participants to view order books and trade data in real time.

Example

A trader on the NYSE can view the bid and ask prices for a stock, as well as the volume of shares available at each price level, allowing for transparent price discovery in a lit pool.