What does "volume" refer to?
What does "volume" refer to?
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External question — Personal Finance Stack Exchange
Author: UTF-8
Original post: https://money.stackexchange.com/questions/117227
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I heard that "volume" refers to something like how much of a stock is traded but have no clue what that means. It seems that no one is using proper definitions for it and that no one in finance ever uses units. Wherever I look, there are no units for anything.
I of course read the Wikipedia article but it's of little help. At least it does specify that "commonly [volume is] reported as the number of shares that changed hands during a given day" (
source
). Is this convention held up by Yahoo Finance? Every stock I'm looking at seems to be listed there, but again there are no units nor any explanation or details I was able to find. Do sales and purchases both count toward that "volume"? So if I sell 1 share to you, does that count as one or two magical volume units? Are only stock exchange transactions counted, not transactions people do with banks that offer external exchanges? If yes, do all stock exchanges count or only one specific one?
There also is a different value called "Avg. Volume":
Again, Wikipedia is of little help. In fact, that definition confuses me further: "The average volume of a security over a longer period of time is the total amount traded in that period, divided by the length of the period. Therefore, the unit of measurement for average volume is shares per unit of time, typically per trading day." It's again about 1 day. Granted a trading day, not a regular day. But these numbers don't seem to have a fixed ratio during the week and its name talks about an average, so I guess it has to be about a longer time span that "volume".
Not trying to talk poorly about Wikipedia btw. Those were the best definitions I was able to find but I'm still clueless. Most "definitions" don't even specify whether they are talking about money or number of shares.
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Quoted from Forex.com.bd-Editorial External question — Personal Finance Stack Exchange Author: UTF-8 Source score (net votes, not local likes): -1 Original post: https://money.stackexchange.com/questions/117227 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. I heard that "volume" refers to something like how much of a stock is traded but have no clue what that means. It seems that no one is using proper definitions for it and that no one in finance ever uses units. Wherever I look, there are no units for anything. I of course read the Wikipedia article but it's of little help. At least it does specify that "commonly [volume is] reported as the number of shares that changed hands during a given day" ( source ). Is this convention held up by Yahoo Finance? Every stock I'm looking at seems to be listed there, but again there are no units nor any explanation or details I was able to find. Do sales and purchases both count toward that "volume"? So if I sell 1 share to you, does that count as one or two magical volume units? Are only stock exchange transactions counted, not transactions people do with banks that offer external exchanges? If yes, do all stock exchanges count or only one specific one? There also is a different value called "Avg. Volume": Again, Wikipedia is of little help. In fact, that definition confuses me further: "The average volume of a security over a longer period of time is the total amount traded in that period, divided by the length of the period. Therefore, the unit of measurement for average volume is shares per unit of time, typically per trading day." It's again about 1 day. Granted a trading day, not a regular day. But these numbers don't seem to have a fixed ratio during the week and its name talks about an average, so I guess it has to be about a longer time span that "volume". Not trying to talk poorly about Wikipedia btw. Those were the best definitions I was able to find but I'm still clueless. Most "definitions" don't even specify whether they are talking about money or number of shares.
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