A parcel of shares or bonds for trade that is smaller than the standard lot for that particular security.
Following the financial crisis, higher capital costs and regulatory scrutiny forced Wall Street banks to sharply reduce their presence in the corporate bond market. With banks holding a smaller 'inventory' of bonds it is harder for investors to buy and sell large amounts of debt. Increasingly, electronic trading platforms are filling this gap. These entities, which include groups such as Market Axess, Bonds.com, Bond Desk and TradingScreen, have been attracting growing volumes of trade in so-called "odd lots", or small trades of older bond issues. In April 2013 the success of these trading platforms began to lead for calls to create one trading venue.
In March 2011, an FT Alphaville post spoke about the disgraced Bernard Madoff whose Ponzi scheme led to his imprisonment. The post refers to an interview with Madoff in which he claims to have started as a legitimate trader grinding out a moderate but steady income on the scraps of business tossed his way by Goldman Sachs and Bear Stearns buying and selling small quantities of bonds – odd lots.