depth (redirected from Depth (disambiguation))

Depth

A term describing the ability of a security to absorb buy and sell orders.

Notes:

Securities with good depth will be relatively liquid and large orders will not affect price significantly. On the other hand, securities will poor depth are more likely to have their price affected by large orders to buy and sell.

To gauge the depth of a market, investors can search for the different prices and sizes (bid and ask sizes) of orders accumulating below and above the market bid and ask prices.

See also: Ask, Ask Size, Bid, Bid Size, Liquidity, Liquidity Risk

---

depth

Used to refer to a security market's ability to absorb large security purchases or sales without significant price changes. A market's depth is an important consideration in selecting securities to trade and markets in which to trade. See also deep market.