Liquidity Tool

Here is a liquidity tool that we provide. It is an excel spreadsheet. What you see above are screen shots of the tool that we have to gain a better grasp of what is happening to a stock that we are following. In the stock symbol row you can type a ticker and the spreadsheet will automatically analyze the liquidity of the stock during a monthly period for the past month ending at the last day that the stock traded.

Definition of Liquidity - is a measure of how much dollar volume is required to move a stock's price up or down by one percentage point. A high ratio indicates a stock that requires relatively heavy trading to move its price. A low liquidity ratio indicates a stock that moves on relatively light volume. The ratio is calculated by adding the daily percentage changes of a stock's closing price for each trading day of the month. Then the total dollar volume for the month is divided by this total-percentage-change figure.