Liquidity & market cap
Market Basics
Can you get out?
Liquidity = how easily you can trade size without moving price. Large caps trade tight and deep; small caps slip and gap. Position size should respect liquidity. Always know your exit door.
Check yourself
Biggest hidden cost of trading an illiquid small-cap?
- Commissions
- Slippage, your own orders move the price correct
- Taxes
In thin names your buy pushes price up and your sell pushes it down. You pay both ways.
Learn this properly
This term has a full interactive lesson in Wick — the chart, the pattern to tap, and a live practice terminal to try it on. Free to start.
Open the lesson