Depth of Market (DOM)

AAA

DEFINITION of 'Depth of Market (DOM)'

A measure of the number of open buy and sell orders for a security or currency at different prices. The depth of market measure provides an indication of the liquidity and depth for that security or currency. The higher the number of buy and sell orders at each price, the higher the depth of the market. Depth of market data is also known as the order book, since it shows pending orders for a security or currency. This data is available from most exchanges for a fee.

INVESTOPEDIA EXPLAINS 'Depth of Market (DOM)'

Depth of market also refers to the number of shares which can be bought of a particular corporation without causing price appreciation. If the stock is extremely liquid and has a large number of buyers and sellers, purchasing a bulk of shares typically will not result in noticeable stock price movements.
 

RELATED TERMS
  1. Market-Maker Spread

    The difference between the price at which a market maker is willing ...
  2. Liquidity

    1. The degree to which an asset or security can be bought or ...
  3. Market Maker

    A broker-dealer firm that accepts the risk of holding a certain ...
  4. Depth

    The ability of a security to absorb buy and sell orders without ...
  5. Order Book Official

    A trading floor participant responsible for maintaining a list ...
  6. Zaraba method

    A method of matching orders that involves using an auction-like ...
Related Articles
  1. Active Trading Fundamentals

    What is liquidity risk?

    Learn how to distinguish between the two broad types of financial liquidity risk: funding liquidity risk and market liquidity risk.
  2. Investing

    Bitcoin Liquidity: What The Stakes Are

    Liquid markets are easy to exit; illiquid markets can put traders in a tough spot. Here are the main factors affecting the liquidity of Bitcoins.
  3. Fundamental Analysis

    What's the difference between capital expenditures (CAPEX) and net working capital?

    Learn more about capital expenditures (CAPEX) and net working capital, two distinct but related measurements of a company's financial health.
  4. Bonds & Fixed Income

    End of Fed's Bond-Buying Program: 7 Things To Know

    This article helps investors understand the economic and financial effects that result when a central bank (like the Fed) ends its bond purchase program.
  5. Options & Futures

    All About Liquid Commodities

    You might hear 'liquid commodities' and think of an auction, but they're actually a high-volume, fast paced financial product suitable for day traders.
  6. Explain the logic behind government loans, how they work, why are they so big in the U.S and how they have an influence in the economy of the U.S and potentially abroad
    Economics

    An Introduction to Government Loans

    Government loans further policymakers' efforts to create positive social outcomes by offering timely access to capital for qualified candidates.
  7. Capital Markets are financial markets.
    Markets

    Capital Markets

    Capital Markets are financial markets where organizations that need money for productive long-term purposes.
  8. Investing

    Using The Current Ratio

    Find out more on how this liquidity ratio is used to measure a company's ability to pay short-term obligations.
  9. Bonds & Fixed Income

    Spotting A Market Bottom

    Recognizing a market bottom can lead to huge opportunities for an investor. We go over how you can spot the bottom so that you can reap the rewards.
  10. Investing Basics

    What exactly is being done when shares are bought and sold?

    Most stocks are traded on physical or virtual exchanges. The New York Stock Exchange (NYSE), for example, is a physical exchange where some trades are placed manually on a trading floor (other ...

You May Also Like

Hot Definitions
  1. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  2. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  3. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  4. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  5. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  6. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
Trading Center