The minimum volume per minute you need to trade depends on your trading style, position size, and the liquidity of the stock. Here are a few key considerations you Shoud keep in mind:
1. Position Size:
- If you plan to trade large positions, you’ll need a higher volume to enter and exit trades without significantly impacting the price. A good rule of thumb is to ensure that the stock's average volume per minute can accommodate at least 5-10 times your position size.
- For example, if you plan to buy $10,000 worth of shares, look for a stock trading with at least $50,000 to $100,000 in volume per minute.
2. Bid-Ask Spread:
- Stocks with lower volumes generally have wider bid-ask spreads, making them more costly to trade. Look for stocks with high volume per minute to reduce this impact, as higher volume tends to tighten spreads.
3. Liquidity:
- For day trading, consider stocks with a daily average volume of at least 1-2 million shares, and a per-minute volume of around 1,000-2,000 shares. This provides enough liquidity to enter and exit trades efficiently without major price slippage.
4. Volatility and Time of Day:
- Volume can fluctuate throughout the day. For example, the first and last hours of the trading day generally have higher volumes. If trading in low-volume times, you may need to adjust your minimum acceptable volume per minute.
If you’re trading with higher leverage, as you mentioned, liquidity becomes even more crucial, so look for stocks with relatively high volumes to ensure smooth entry and exit.
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