Which trading locations or mechanisms are commonly referred to as dark pools?

Dark pools are private trading venues that allow institutional investors to trade large blocks of securities without publicly revealing their intentions to the market until after the trades are executed. This mechanism is beneficial for large traders who wish to minimize market impact and avoid slippage in their trades.

Alternative trading systems (ATS) serve as the umbrella for various types of trading venues that do not have the same formal exchange regulations. Dark pools are one such type of ATS specifically designed for executing large trades without the pre-trade transparency required on formal exchanges. They facilitate transactions away from public markets and can provide advantages in terms of price execution and privacy.

This structure is what distinguishes dark pools from other trading locations. Traditional brokerages and formal stock exchanges operate under different sets of regulations that require disclosure and transparency, while dark pools maintain anonymity until after the trades are consummated. Commingled accounts, on the other hand, refer to investment vehicles that pool funds from multiple investors but do not specifically relate to the mechanisms of trading executed within dark pools.