Liquidity
The amount of trading activity, and thereby the ease with which you can get in and out of a market. Measured by volume (and open interest in the case of futures markets).
Articles related to Liquidity
David Penn
Dave Goodboy
April 8, 2008
Larry Schneider
No one likes to lose money. Ever. But the veteran trader knows there are two kinds of losses. Those caused by being on the wrong side of the market and those caused by doing something dumb and avoidable.
(more)April 4, 2008
Dave Goodboy
Trading and investing: not just both sides of the same coin.
(more)March 25, 2008 about
JPM |
BSC Kevin Haggerty
Market commentary and analysis by Kevin Haggerty.
(more)March 20, 2008
Kevin Haggerty
The Fed is attempting to inflate the economy out of trouble again, as it has done every downturn since Fed Chairman Volker did the opposite to choke the inflation.
(more)
Ashton Dorkins
Ashton Dorkins
July 14, 2006
It seems like if it's a good short, the price travels too far down before an uptick occurs. Any ideas on how to deal with this problem?A: As a trader, I believe in free markets. In my opinion, the uptick rule for stocks (there is no uptick rule in futures) is one more regulation that reduces market freedom. Your observation is correct: Stocks can get away from you on the short side if they don't uptick. In general, less liquid stocks and more volatile stocks tend to move further without an uptick. Therefore, if you are having problems getting your shorts off (no pun intended), you might try to focus on more liquid or less volatile stocks--or change your methodology for thinly traded and volatile stocks. For example, you might find it easier to enter on a pullback instead of a breakout in these stocks. Even though shorting stocks does have its pitfalls, you must make it part of you trading regimen to survive in the markets long term.
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