Can Determining a Stock's Volume Affect Profit?

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Let's talk about volume. Volume is the number of a stock’s shares that trade in a day, month, or year. So why should volume be such a key factor in your trades? Here’s what you need to know about volume and stocks BEFORE you risk your hard-earned money.

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Volume, in terms of trading, is the number of a stock’s shares that trade in different time frames. It can be a day, month, or year. There are a lot of different time frames.

So why is trading volume so important?

First, check out the book by my student Jamil Ben Alluch: “The Complete Penny Stock Course.” I'll post a link below ... This is must-read material. It combines a lot of my lessons in one book. So if you want a quick resource to learn my rules, read the book.

Back to volume ... This is about how many shares are traded back and forth between buyers and sellers. If a million shares of a stock trade in a day, that's 500,000 shares bought and 500,000 shares sold.

I'll give you a few terms that you need to know when trading stocks: liquidity and volatility. Liquidity is how much volume a stock has, how much action. Volatility refers to how unpredictable and rapidly changing the stock is.

(Quick side note: There’s another reason to read Jamil’s book — it explains these terms.)

Back to volume ... You never want to be too big of a percentage of the volume. And you definitely don't want to be all of it. I want to trade the big percent gainers. Stocks that are volatile. Volume shows interest.

If you're a bigger percentage of the volume, it’s more difficult to execute your buys or sells. If it's rising, fantastic. But if it starts fading, it can all crash very quickly. And your stuck holding the bag.

As a buyer, you can ride these stocks up. As a short seller, you can do the opposite — you try to make money on the way down. The greater the percentage you are of a stock’s daily volume, the greater the risk.

I want to teach you the safe way to cut losses quickly.

How do you determine a stock’s volume? Ever get stuck in a trade because of low volume? Leave a comment below and tell me about your profits or losses!

#TimothySykes #Pennystocks #Investing

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Hey, it’s Tim Sykes, millionaire mentor and trader. Thank you for watching my videos. I hope that they help you. I want to share everything that I've learned over the years. You can check out more videos right over there, and also click ‘subscribe’ so that you can watch all of these videos, get that knowledge and become my next millionaire student.*

* Results may not be typical and may vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here