Hi Everyone, I was wondering; why dont people trade the liquid stocks? For example sun is currently one of the most liquid stock these days. Why arent people trading this? From what I understand people seem to go for volatile stocks. However if a stock is liquid then there is more chance of getting filled? Am I missing something here? Regards, Splat
Hope you're not making it in the old fashioned way in the workshop But seriously i asked the question since I am trying to get experienced from you experienced trading fellows! Regards, Splat
I like illiquid ones b/c a poorly timed order will boot it fast and far. If something trades 100k a day and someone wants out of 200k fast, hes gonna take it down 5%+ in a day. You can tell when he cleans up and take 2-5k shares for a 2% pop very easilly. More importantly, whereas something liquid has a specialist who's mainly just making a market for nickles, in something thin the specialist takes an active interest and you can read him much better. Sun has been in a 50c range every day for months. Why bother.
Considering its tight range Sun might be an excellent stock to sell uncovered (or covered) options on... if you're into that kind of thing