Which of the following factors does not indicate market liquidity? A) Number of shareholders B) High price volatility C) Number of shares outstanding D) Number of shares traded E) Institutional interest

Question

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Market liquidity refers to the ability of a security to be bought or sold without significantly affecting its price. Factors that indicate market liquidity include the number of shares traded, institutional interest, and number of shares outstanding as these factors reflect the ease with which a security can be bought or sold. However, high price volatility does not necessarily indicate market liquidity as it may be caused by external factors like news or events, rather than the ease of trading the security. Therefore, choice B does not indicate market liquidity.

Which of the Following Factors Does not indicate Market Liquidity