A trading algorithm on volume-weighted average price (VWAP). It is one of the most popular trading algorithms whereby a trader aims to achieve an average execution price nearest to the realized or actual VWAP. The VWAP represents the best possible price that a trader seeks to achieve for the principal. VWAP trading algorithms use a preset trading schedule that aims to get closer to the volume pattern realized over the trading period. This schedule is figured out by averaging historical trading patterns.