Average Volume

RECENT NEWS
The Economic Times  Jul 15  Comment 
The stock has broken above a resistance at 364 faced during April 2016. The breakout is supported by volumes, as 5-day average volume is 43.58 pct higher than 30-day average volume.
Forbes  Jul 13  Comment 
The most recent short interest data has been released for the 06/30/2016 settlement date, which shows a 1,952,653 share decrease in total short interest for Rackspace Hosting Inc (NYSE: RAX), to 14,923,469, a decrease of 11.57% since 06/15/2016....
Forbes  Jul 13  Comment 
The most recent short interest data has been released for the 06/30/2016 settlement date, which shows a 1,471,296 share decrease in total short interest for B/E Aerospace, Inc (NASD: BEAV), to 7,791,187, a decrease of 15.88% since 06/15/2016....
Forbes  Jul 13  Comment 
The most recent short interest data has been released for the 06/30/2016 settlement date, which shows a 1,554,134 share decrease in total short interest for Macerich Co. (NYSE: MAC), to 2,844,822, a decrease of 35.33% since 06/15/2016. Total short...
Forbes  Jul 13  Comment 
The most recent short interest data has been released for the 06/30/2016 settlement date, which shows a 2,620,516 share decrease in total short interest for Carnival Corp (NYSE: CCL), to 17,231,937.0, a decrease of 13.20% since 06/15/2016. Total...
Forbes  Jul 13  Comment 
An examination of the most recent short interest data revealed these five Carl Icahn stocks with particularly high short interest, as measured by "days to cover." This metric is just one way to look at short data, but this is a metric we here at...
Mondo Visione  Jul 6  Comment 
Euronext, the leading exchange in the Eurozone, today announced trading volumes for June 2016. The June 2016 average daily transaction value on the Euronext cash order book stood at €8,345 million (-9.3% compared with June 2015, which was a...
newratings.com  Jul 5  Comment 
WASHINGTON (dpa-AFX) - CME Group (CME) announced Tuesday that June 2016 average daily volume or ADV reached 16.4 million contracts per day, up 13 percent from June 2015. CME's options volume in the month averaged 3.4 million contracts per...
Mondo Visione  Jun 30  Comment 
Business as usual for OANDA customers as they trade through exceptionally uncertain times OANDA   a leading global provider of online foreign exchange (“Forex” , “FX”) and over-the-counter commodities, bonds and indices trading...
Forbes  Jun 28  Comment 
The most recent short interest data has been released for the 06/15/2016 settlement date, which shows a 2,550,262 share decrease in total short interest for PulteGroup Inc (NYSE: PHM), to 19,114,631, a decrease of 11.77% since 05/31/2016. Total...




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The average volume is the average number of shares traded daily for a particular security

Also known as average daily volume or average daily trading volume, the average daily volume is a measure of the liquidity of a stock based on the number of shares that trade hands from sellers to buyers each day. If a buyer purchases 100 shares, then the volume for that period increases by 100 shares from that transaction.

Unusually high volume in comparison to the average daily volume can indicate big news about a company - if something has changed investors' perception of a company's value, the trading that results (either buying or selling) pushes up volume for that day - for example, if a company submitted earnings or guidance that was unexpectedly high or low.

Securities with high average daily volume can be easily traded and are very liquid. Companies with low average daily volume are less liquid and harder to trade because there are fewer buyers and sellers for the stock. Securities with low average daily volumes (for example, fewer than 50,000 trades a day) are susceptible to higher volatility because sellers have more control over the price of the security. Securities with higher average daily volumes are more competitive and therefore less volatile.

Examples

Consider an extreme case of low average daily volume where there is only one seller of a security. If you want to buy that security from the seller, you have to accept their price because there is no one else competing for the sale. Later, as an owner of this low average daily volume security, the company releases horrible earnings news. Now, wou want to sell the security, however, because there are very few buyers for security, you are stuck with it.

In another case, you have two securities you're considering purchasing. Everything about the two companies is equivalent -- share price, earnings, demographics, etc. -- except, one of the securities has a higher trading volume than the other. In this case, purchase the company shares with the higher trading volume. This will ensure you purchase the shares at a competitive price and will have a better chance of selling the shares in the future.

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