High-Liquidity Strategy Generates 137.53% Excess Return Over Benchmark as Phillips 66 Ranks 300th in Daily Trading Volume

On July 31, 2025, Phillips 66 (PSX) recorded a trading volume of $0.49 billion, ranking 300th among stocks by daily liquidity. The energy giant closed 0.66% lower, reflecting market dynamics influenced by strategic trading patterns.

The performance of high-liquidity stocks over the past three years has demonstrated a clear edge in capturing market momentum. A volume-based strategy—purchasing the top 500 stocks by daily trading volume and holding for one day—delivered a 166.71% cumulative return from 2022 to July 30, 2025. This significantly outperformed the benchmark index, which posted a 29.18% gain during the same period, generating an excess return of 137.53%.

The success of such strategies highlights the role of liquidity in amplifying price movements. Stocks with surging volumes, including those in real estate and technology sectors, often drive short-term momentum. However, Phillips 66’s recent decline underscores the volatility inherent in even well-capitalized names amid shifting market structures.

While the volume-based approach remains robust, its effectiveness hinges on precise execution and timing. The strategy’s ability to adapt to evolving conditions from 2022 to 2025 reinforces the importance of liquidity as a key driver in momentum-driven environments.