The aim of using a VWAP trading target is to ensure that the trader executing the order does so in line with the volume on the market.
The first execution based on the VWAP was in 1984 for the Ford Motor Company by James Elkins, then head trader at Abel Noser.
[5] Institutional buyers and algorithms often use VWAP to plan entries and initiate larger positions without disturbing the stock price.
[4] VWAP slippage refers to the difference between the intended and executed prices, and is a common measure of broker performance.
Many Buy-side firms now use an algo wheel to algorithmically direct their flow to the best broker.