#交易流动性 Four-Dimensional Measurement Indicators

Speed (Timeliness): The speed at which transactions are executed, such as how the stock market can typically execute trades in real-time.

Price (Bid-Ask Spread): The smaller the spread, the higher the liquidity. For example, in the foreign exchange market, currency pairs with abundant liquidity (like EUR/USD) usually have a spread of less than 0.1%.

Quantity (Market Depth): The ability for large orders to be executed at reasonable prices. For example, after liquidity improvements at the North Exchange, the average daily trading volume increased from 2.6 billion to 43.6 billion, supporting a doubling of stock prices.

Elasticity (Price Recovery): The speed at which prices return to equilibrium after being impacted. A highly elastic market can quickly absorb short-term fluctuations.

Significance to Investors

Risk Management: High liquidity assets (such as large-cap stocks) make it easier to stop losses and adjust positions, reducing the risk of a 'liquidity trap'.

Transaction Costs: When liquidity is abundant, the bid-ask spread is small, reducing trading friction costs. For example, when A-share liquidity is ample, individual stocks are easy to rise but hard to fall.

Opportunity Capture: Liquidity distribution can reveal institutional trends. For instance, when prices break through key resistance levels, it may trigger stop-loss orders (liquidity traps), followed by trend reversals.

Significance to the Market

Market Drive: Abundant liquidity drives market activity, such as in a bull market where funds continuously flow in, forming 'volume and price rising together'.

Systemic Risk: Liquidity exhaustion can lead to stock market crashes, as seen in the 2008 financial crisis when the liquidity crisis exacerbated market collapse.