Which is the most liquid market for trading?
Which is the most liquid market for trading?
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Nok Imchen · External communityPost link
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Author: Nok Imchen
Original post: https://money.stackexchange.com/questions/23135
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I've traded spot forex and I found it really liquid (trades can be executed within a few seconds).
However, in NSE (India) share market, it takes between minutes to days to sell the shares I've purchased.
I'd like to know which is the most liquid market besides spot forex. Would it be currency derivatives (futures), options, stock derivatives, commodities, bonds, etc.?
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hroptatyr · External communityPost link
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Author: hroptatyr
Original post: https://money.stackexchange.com/a/23145
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Depends on how you measure liquidity. There's
papers out there
that approach this very question.
Measured in order book spreads for a consolidated $100m trade, I'd say the second biggest market is FX swaps, followed or par'd by the money market (government bonds).
If you disallow OTC venues, it's most definitely exchange listed government bonds.
If, however, you happen to think in terms of sheer volume per time, the most liquid market phase could be considered the NYSE closing auction, as you can move billions in a matter of minutes, or expressed in speed terms: several m$/s (million dollars per second).
You should pick a definition and we can provide you with a more accurate list of candidates and actual data.
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NewIdeas · External communityPost link
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Author: NewIdeas
Original post: https://money.stackexchange.com/a/23164
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I would rate index futures, in particular the US index futures (e.g. the S&P 500 future) as the most liquid markets after the forex markets.
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Quoted from Forex.com.bd-Team External answer — Personal Finance Stack Exchange Author: hroptatyr Source score (net votes, not local likes): 5 Original post: https://money.stackexchange.com/a/23145 License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Depends on how you measure liquidity. There's papers out there that approach this very question. Measured in order book spreads for a consolidated $100m trade, I'd say the second biggest market is FX swaps, followed or par'd by the money market (government bonds). If you disallow OTC venues, it's most definitely exchange listed government bonds. If, however, you happen to think in terms of sheer volume per time, the most liquid market phase could be considered the NYSE closing auction, as you can move billions in a matter of minutes, or expressed in speed terms: several m$/s (million dollars per second). You should pick a definition and we can provide you with a more accurate list of candidates and actual data.
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