The process of building a deep pool of tradable securities/ assets from which quotes are streamed directly to a trader terminal. In other words, it is the process of gathering buy and sell orders from different sources to put together market liquidity for a specific type of products or instruments such as FX, commodities, precious metals, etc., before orders are matched. Trades or orders are transmitted to liquidity aggregation venues/ exchanges for order verification and matching of buy and sell orders.

Liquidity or market liquidity constitutes market participants’ ability to convert assets/ securities from one form to another with a relative ease. It indicates the degree to which an asset or security can be quickly traded in the market without an impact on its price.