Trading & Market Structure

Market Depth

Definition

What is Market Depth?

The quantity of buy and sell orders available at different prices.

Example in practice

A deep market can absorb a large order with limited price movement.

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The highest price a buyer is currently willing to pay for a security.

The lowest price a seller is currently willing to accept for a security.

The difference between the best available buying and selling prices.

An instruction to buy or sell immediately at the best available prices.

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