TWAP stands for time-weighted average price. In trading, a TWAP execution approach spreads an order across a period of time rather than attempting to fill the entire amount immediately. The time-weighted benchmark and the actual achieved execution price are not necessarily identical.
Why spread an order over time?
A large immediate order can consume available liquidity and move through several price levels. Breaking the order into smaller parts can reduce that immediate footprint. The trade-off is that the market may move while execution is still underway.
Imagine the same order arriving in a deep market and a thin market. An identical fixed schedule can have different effects because the available liquidity differs. Time alone is not the full execution problem.
What makes AlphaNet’s TWAP dynamic?
The AlphaNet user guide lists Dynamic TWAP as available and treats VWAP and hybrid variants as future additions. Its policy adjusts execution within a time limit using live market inputs.
Dynamic pacing seeks to balance market impact against the risk of waiting. It does not guarantee a better price than an immediate order, the starting price or the TWAP benchmark. The result still depends on liquidity, market movement and whether the order can be completed under its constraints.