What is Liquidity?
Liquidity is a feature of the Token; it is an indication of how easily a Token can be traded without affecting its market price.
Traders and users are drawn to tokens that exhibit higher liquidity, as it enhances their attractiveness in the market.
Why is market liquidity so important?
A market with high liquidity is typically linked to lower risk, as there is consistently someone available to assume the opposing side of a given position.
These favorable market conditions often entice speculators and investors, contributing to increased participation in the market.
Abundant liquidity implies a substantial volume of buy and sell orders in the underlying market. This heightened activity raises the likelihood of the highest buying price and the lowest selling price converging, effectively narrowing the bid-offer spread.
In contrast, an illiquid market tends to exhibit a broader spread, indicating a larger disparity between the highest buying price and the lowest selling price.
Marnic Group ensures that your digital asset is consistently quoted with both a bid and ask price on the exchange.
As a result, buy and sell orders can be executed at any time without significant price fluctuations, providing stability to the trading process.
Execution analysts
Execution analysts play a crucial role in decision-making, encompassing responsibilities such as risk management and the formulation of predictions for future investments. Additionally, they conduct post-trade analyses of liquidity conditions to elucidate abnormal impact and slippage.
A profound understanding of market liquidity is essential for execution analysts to address questions like "why did this trade cause a more substantial movement in the share price than anticipated?" or "why did the execution price deviate significantly from expectations?"
What are the core objectives of Marnic Group?