Importance and Strategies of Trade Execution in Portfolio Management

As a portfolio manager, you are tasked with executing a trade order for a large equity position. Given the potential market impact of this large trade, it is vital to consider the execution strategies that can be employed to mitigate costs and risks. Explain the importance of execution strategies in portfolio management, and describe at least two execution strategies that could be used to efficiently manage the trade. Discuss the potential advantages and disadvantages of each strategy.