  We compare optimal static and dynamic solutions in trade execution. An
optimal trade execution problem is considered where a trader is looking at a
short-term price predictive signal while trading. When the trader creates an
instantaneous market impact, it is shown that transaction costs of optimal
adaptive strategies are substantially lower than the corresponding costs of the
optimal static strategy. In the same spirit, in the case of transient impact it
is shown that strategies that observe the signal a finite number of times can
dramatically reduce the transaction costs and improve the performance of the
optimal static strategy.
