Liquidity is the ease with which a stock can be bought or sold without a big impact on the share price. In general, this can be determined by the average daily trading volume of the stock in a particular stock market. The more actively traded a stock is, the more liquidity it has, and hence easier to dispose of on a particular stock market.
A thin trader is a stock with a small average daily trading volume. Thin or low liquidity traders trade a few hundred to a few thousand shares daily, compared to tens if not hundreds of thousands for, say, a Canadian bank.
A lack of liquidity or being illiquid, can make it hard to sell any stock in a hurry without accepting a big cut in price. That’s why successful investors prefer liquidity over a lack of liquidity.
However, unexpected bad news can make liquidity dry up in a heartbeat.
For lasting investment safety, you need to buy well-established, prosperous companies—with high liquidity—like those we recommend in our publications, even Stock Pickers Digest (some of its recommendations do fit that description), and you need to diversify.
All in all, for a sound long term investing strategy we recommend using our three-part Successful Investor philosophy:
Discover how most investors who successfully build wealth over the long term follow certain investing practices. Find out what they are in our FREE investing guide, How to Invest in Stocks: Canada Investor Advice on Building a Balanced Stock Portfolio.
When it comes to dual-class shares, the voting shares have certain advantages over non-voting shares
Aside from specific investments (such as U.S. and Canadian stocks, income trusts or exchange-traded funds), our Inner Circle members ask us about a wide range of investments. For example, I’ve been… Read More
When comparing penny stocks vs blue chip stocks, only one provides value and consistency. Here’s how to evaluate them and maximize your investment returns.
Penny stocks are generally riskier than other investments, and early success can (paradoxically) lead to big losses. On the other hand, blue… Read More
These two Canadian ETFs track Canada’s best-established indexes and provide low-fee exposure to widely traded blue chip stocks.
When you invest in ETFs, simpler is generally better. And each of these two Canadian ETFs provides a straightforward approach to investing in a selection of Canada’s top… Read More
Renewable energy ETFs have attracted popular approval, and not just with socially conscious investors. Still, are these ETFs good investments?
What are renewable energy ETFs?
Renewable energy ETFs are exchange-traded funds that invest in companies involved in clean energy production, distribution, and technology, including solar, wind, hydroelectric,… Read More
Precious metal ETFs have largely centered on gold stocks. We continue to see the outlook for that precious metal as positive, and for aggressive investors who want to hold precious metal ETFs, including a silver ETF, we have two of them below.
Most precious-metal stocks dropped,… Read More
Investors wondering how to buy penny stocks need to avoid looking for a get-rich-quick stock and instead invest in speculatives with actual investment value
Penny stocks have appeal for some aggressive investors who aim to get into fast-growing stocks at what they describe as “the ground… Read More
ETF investing is one of the best financial innovations of our time but themed ETF investing—including the Dogs of the Dow or the equivalent ETFs on TSX—is a poor investing strategy
Dogs of the Dow, or Dow dogs for short, is not alone, however, with the… Read More
Exchange traded funds (ETFs) are set up to mirror the performance of a stock market index or subindex. They hold a more or less fixed selection of securities representing the holdings that go into calculating the index or sub-index.
Today, we look at two Canadian ETFs… Read More
Any currency volatility can send investors hunting for hedged ETFs. But the extra costs limit the appeal of currency hedging as a strategy.
If you want to buy U.S. stocks and hedge against the U.S. dollar’s movements against the Canadian dollar, you could buy a hedged… Read More
Traditionally, there have been several options for parents and grandparents looking to make investments for children. But here’s how to choose the best investments for children in 2025.
Taking the time to pick the right investments for children and grandchildren is a worthwhile endeavour. If the… Read More
Learn everything you need to know in 'The Canadian Guide on How to Invest in Stocks Successfully' FREE Special Report from The Successful Investor.
How to Invest In Stocks Guide: Find 10 factors that make your investments safer and stronger.
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We are continuously in the process of improving our sites and services. If any new features or policies require a change to this current policy, we will post a clear notice of this change on pages of our site where the privacy policy appears. The principle behind this privacy policy is to collect information with your knowledge and consent.
What personal information do we collect?
The information we receive from customers helps us personalize and continually improve your online experience at TSI Network. TSI Network may collect personal information online for all legal purposes, which include, but are not limited to:
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Does TSI Network Use the Information It Receives?
"Contact Us" and Comment Features: TSI Network encourages visitors to its websites to contact us with questions and comments. Email addresses and other information of persons using these features may be collected in order to facilitate our responses to those inquiries.
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TSI Network does everything possible to prevent unauthorized intrusion to its websites and the alteration, acquisition or misuse of personal information by unauthorized persons. Notably passwords submitted by users of our websites are encrypted using encryption mechanisms. However, TSI Network cautions visitors to its websites that no network, including the Internet, is entirely secure. Accordingly, we cannot be responsible for loss, corruption or unauthorized acquisition of personal information provided to our websites, or for any damages resulting from such loss, corruption or unauthorized acquisition.
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TSI Network has procedures in place to keep your personal information accurate, complete and current for the purposes for which it is collected and used. You may review the information that you have provided to us and where appropriate you may request that it be corrected. If you wish to review your personal information please send a request to: service@tsinetwork.ca.
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What Choices Do I Have?
Changes to this Policy
This Policy is the sole authorized statement of TSI Network's practices with respect to the collection of personal information through TSI Network's websites and the subsequent use and disclosure of such information. Any summaries of this Policy generated by third party software or otherwise (for example, in connection with the "Platform for Privacy Preferences" or "P3P") shall have no legal effect, are in no way binding upon TSI Network, shall not be relied upon in substitute for this Policy, and neither supersede nor modify this Policy.
TSI Network may revise this Policy from time to time.
Legal Notices and Disclaimers
The contents of this web site and our publications are based upon sources of information believed to be reliable, but no warranty or representation, expressed or implied, is given as to their accuracy or completeness. Any opinion reflects the Successful Investor’s judgment at the date of publication and neither the Successful Investor, nor any of its affiliated companies, nor any of their officers, directors or employees, accepts any responsibility in respect of the information or recommendations contained in the publications or on this web site. Moreover, the information or recommendations are subject to change without notice.
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