Cryptocurrency Q&A
What is lack of liquidity in trading?
What is lack of liquidity in trading?
charlotte_anderson_explorer
Sat Nov 30 2024
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7 answers
1325
I'm trying to understand the concept of lack of liquidity in trading. Could you explain what it means when a market or asset is described as having low liquidity?
7 answers
EthereumEmpire
Sun Dec 01 2024
Liquidity is a crucial factor in determining the efficiency of a financial market.
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DondaejiDelight
Sun Dec 01 2024
As a result, traders may face difficulties in finding willing counterparties.
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Dario
Sun Dec 01 2024
When liquidity is low, the bid-offer spread tends to widen significantly.
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DigitalLord
Sun Dec 01 2024
Moreover, the general lack of information available about exotic pairs exacerbates the problem.
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CryptoKing
Sun Dec 01 2024
This is because there are fewer market participants willing to buy or sell a particular asset.
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