What range of volume is considered a good stock

**Bottom line first 🏁** For most individual investors in U.S. equities, a “healthy” or “good” daily trading-volume range typically starts **above 500 000–1 000 000 shares or roughly ≥ $20–25 million in dollar turnover per day**, and scales higher for larger-cap names that trade several million shares daily. Below this zone liquidity drops off quickly, spreads widen, and price impact grows. --- ## Why this volume range matters 📊 | Metric | What to watch | Why it matters | | --- | --- | --- | | **Average Daily Volume (ADV)** | ≥ 500 k–1 M shares | Keeps bid/ask spreads tight (< 5 bp for large-caps) so you can enter/exit without excessive slippage | | **Dollar Volume** (Price × Shares) | ≥ $20 M–$25 M | Ensures institutions (and you) can move blocks without moving the market | | **Float Turnover** | 1–2 % per day | Indicates that the stock’s shares change hands regularly; lower turnover = potential liquidity traps | | **Intraday volume profile** | Consistent through the session | Avoids “air pockets” where liquidity dries up midday | ### Common reference points 1. **SPY / QQQ level:** ETFs trade > 50 M shares/day—near-perfect liquidity. 2. **Mega-caps (AAPL, MSFT):** 30–90 M shares/day—ample for any retail or institutional order. 3. **Mid-caps:** A “good” range is 1–5 M shares/day. 4. **Small-caps:** Liquidity threshold often defined at ≥ 1 M shares/day; below 300 k shares/day spreads widen sharply. --- ## Nuances to keep in mind 1. **Price matters:** A $5 stock that trades 1 M shares/day only moves $5 M—not very liquid in dollar terms. Use **dollar volume** ($ price × shares) as the true yard-stick. 2. **Spread & depth:** Even with 1 M ADV, quoted spreads can stay wide if depth is thin (common under $2). Always glance at Level II or LOB depth. 3. **Event-driven spikes:** Earnings or news can temporarily inflate volume 3-5×; make sure the stock retains decent liquidity once the hype fades. 4. **Your own order size:** Liquidity is relative. A 10 000-share order in a 500 k ADV stock equals 2 % of daily flow—high but workable; 100 000 shares would likely move the price. 5. **Market regimes:** During volatile periods (e.g., Fed meetings, tech sell-offs) volumes balloon, temporarily pushing even fringe names into the “good” zone—don’t assume it will last. --- ## Quick rules of thumb for screening 🛠️ • **Dollar volume filter:** > $25 M/day • **Share volume filter:** > 1 M shares/day **or** > float × 1 % • **Bid-ask spread:** ≤ 0.1 % of mid-price for large/mega caps, ≤ 0.3 % for small-caps • **Turnover consistency:** At least 80 % of trading days above these thresholds over the past month. Apply those filters and you’ll avoid the majority of illiquid traps while still capturing plenty of opportunities in the AI, 5G, and Smart-City themes you favor. 🚀