Options Glossary

Glossary: Liquid / Liquidity

Last Updated: July 12, 2015


Liquid / Liquidity

What Does Liquid / Liquidity Mean in Options Trading?

The characteristic of high volume of trades in an option so as to be able to easily square of any held position in that option at reasonable market price. Volume and the width of the bid-ask spread are good idications of overall contract liquidity.

Related Options Trading Terms

homeusercrossmenuarrow-right-circle linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram