How a block trade is priced and printed

Pricing begins with the most recent observable market price for the stock — typically the last traded price or the volume-weighted average price over a recent period. This reference point anchors the conversation, but it is only the starting point. A principal buyer must immediately look beyond the screen price to understand what a large sale of the same stock would do to the market if executed openly. In many cases, the act of selling a substantial parcel in the open market would move the price adversely before the full quantity could be absorbed. The reference price must therefore be adjusted to reflect the real cost of unwinding or hedging the acquired position, not simply the price available for the first few hundred shares in the order book.

When a principal buyer takes a large block onto its balance sheet, one risk management tool available is borrowing shares in the securities lending market to create a short position that partially offsets the long exposure until it can be wound down. The availability of borrow — that is, the willingness of other holders to lend their shares at a reasonable cost — therefore affects how the block is priced. If borrow is scarce or expensive, the hedging cost is higher and the bid will reflect that. This component of pricing is entirely invisible to the selling shareholder but is a real and material consideration for the buying principal. Understanding that borrow cost feeds directly into the discount can help sellers appreciate why pricing is not simply a reflection of the last traded price.

Once a price is agreed, the trade is executed — or printed — through whatever settlement mechanism is appropriate for the relevant market and jurisdiction. In most cases this involves direct transfer of shares against payment via the exchange’s central securities depository. The trade may or may not be publicly reported depending on the reporting obligations of the relevant market. Regardless of reporting requirements, Black Haven operates with full regulatory compliance in all jurisdictions in which it acts as principal. The seller receives a clean transfer of consideration and the block exits their custody. From that moment, the market and settlement risk belongs entirely to Black Haven.