Investors Need To Be Aware Of Transaction Costs When Executing An Investment Str

Investors need to be aware of transaction costs when executing an investment strategy. The three dimensions of transaction costs are brokerage fees, the bid-ask spread and price impact.

Explain the types of trades (both investor characteristics and stock characteristics) that would tend to result in the price impact being the biggest contributor to overall transaction costs when executing a trade.                                               (2 marks)

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