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 Trading volume determines liquidity right?

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TSNight Shift
post Mar 13 2025, 11:01 AM, updated 10 months ago

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How do I know a stock that I am buying is easy to find a seller later? By looking at the volume? What is a good number?
Chengi
post Mar 13 2025, 11:12 AM

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warrant ?
Medufsaid
post Mar 13 2025, 11:16 AM

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you look at the buyer and seller queue in order book. how many ppl willing to buy in left column, and how many willing to sell in right column
ragk
post Mar 13 2025, 03:22 PM

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that's no guarantee, just imaging u are buying house, that's many buyer now doesn't guarantee that's many buyer in the future

This post has been edited by ragk: Mar 13 2025, 06:38 PM
koja6049
post Mar 13 2025, 05:14 PM

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QUOTE(Night Shift @ Mar 13 2025, 11:01 AM)
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How do I know a stock that I am buying is easy to find a seller later? By looking at the volume? What is a good number?
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misconception. There is always a buyer and seller if it is still listed on the stock market. It is only the stock price that you're concerned about. Low liquidity stocks is more susceptible to manipulation (obviously because there's only a handful of market makers so they get to dictate the price).
https://www.investopedia.com/articles/activ...lume-stocks.asp
koja6049
post Mar 13 2025, 05:26 PM

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QUOTE(Medufsaid @ Mar 13 2025, 11:16 AM)
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you look at the buyer and seller queue in order book. how many ppl willing to buy in left column, and how many willing to sell in right column
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no, trading queue is not trading volume. Only when the transaction goes through it is counted as volume: https://corporatefinanceinstitute.com/resou...olume-of-trade/

Low volume stocks can have very high trading queue, especially when it is done by market manipulators. This is especially prominent in high frequency trading, where manipulators just queue for fun and then cancel the queue to manipulate the stock price (also called spoofing). https://www.bradley.com/insights/publicatio...ore-enforcement
Hansel
post Apr 13 2025, 04:11 PM

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QUOTE(Night Shift @ Mar 13 2025, 11:01 AM)
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How do I know a stock that I am buying is easy to find a seller later? By looking at the volume? What is a good number?
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Then you are concerned with the liquidity of a stock, not the volume. Look at the mkt depth for the stock,... ie see the amt queued for buy and sell,.... Bt of course this queue is very fluid. if the numbers can disappear at a split second.

Secondly,... you'll get some hints/signs too from the volume transacted,... see if the volume for a few days 'match' the queue sizes or not.
SUSipohps3
post Apr 13 2025, 04:14 PM

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Nvidia gg? so many sell. cry.gif

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Medufsaid
post Apr 13 2025, 04:20 PM

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ipohps3 wait until tomorrow 8am Malaysian time (8pm Sunday usa). 24 hour trading begins on that time
Cubalagi
post Apr 13 2025, 04:31 PM

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QUOTE(Hansel @ Apr 13 2025, 04:11 PM)
Then you are concerned with the liquidity of a stock, not the volume. Look at the mkt depth for the stock,... ie see the amt queued for buy and sell,.... Bt of course this queue is very fluid. if the numbers can disappear at a split second.

Secondly,... you'll get some hints/signs too from the volume transacted,... see if the volume for a few days 'match' the queue sizes or not.
*
Pro answer this 👍

Liquidity also varies on time of day of the market.


This post has been edited by Cubalagi: Apr 13 2025, 04:33 PM

 

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