The concept
is how easily an asset can be bought or sold without moving its price much.
Why it matters
Liquid markets have tighter spreads and less slippage.
How markets interpret it
Gold is one of the most liquid commodities, but liquidity still thins at certain hours.
Key takeaways
- Liquidity affects spreads and slippage.
- It varies through the day.
Knowledge check
Low liquidity usually means…
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