Market Depth
2 definitions

Market Depth

The ability of a market to absorb excess demand to buy or sell a security without affecting the price quoted for subsequent trades. A market with a lot of depth will have low price impact from trading.

Market Depth

Market depth is a dimension of market liquidity and it refers to the ability of a market to handle large trade volumes without a significant impact on prices.

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About this term

Market Depth has been defined 2 different ways in documents like Office of Financial Research Glossary, Glossary of Statistical Terms.

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