In trading, what does liquidity mean and how does it work
In: Economics
To put it simply, liquidity is the amount of supply and demand for a product. For instance, it is very easy to purchase Bank Of America stock because there is a lot of it, and people are constantly buying and selling it, and offering bids and offers. This means that there is a lot of liquidity for this stock. When a stock is liquid, you can almost literally buy or sell it at anytime, without impacting the price very much if at all.
Latest Answers