Price Improvement

Price improvement occurs when a trade is executed at a price better than the best available bid or offer at the time the order was placed. This often happens in venues that use smart order routing to scan multiple liquidity pools for the best possible price.

It can also occur when a market maker offers a better price to capture order flow from retail traders. Price improvement is a direct benefit to the trader, as it reduces the effective cost of the trade.

It serves as a key performance indicator for retail brokerage execution quality. In the crypto space, decentralized aggregators strive to provide price improvement by routing trades through various liquidity sources to find the optimal path.