Apr 192019
 

A market which allows quick and efficient entry or exit at a price close to the last traded price. The ability to liquidate or establish a position quickly is due to a large number of traders willing to buy and sell.

Maintaining a liquid market is important because it minimises the spread for buyers and sellers.  An example of a highly liquid market would be the trading of a major stock such as Vodafone or Apple.  Many millions of shares are traded per day, so exiting your position is simple and low cost.

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