1

Which version is right:

Version 1:

Amount = Volume x Price per asset

Version 2:

Volume = Amount x Price per asset

I guess, version 2. But I am not sure..

When looking at an orderbook, the word amount is used. For example:

ASK-Price: 1$
ASK-Amount: 4

This means that there is an interest to sell 4 units of the asset with a price of 1$ per asset. So the volume for this is 4x1. It does NOT mean, that the ASK-amount of 4 is calculated by Volume * Ask-Price. That means, amount must be the number of assets.

What is the right distinction between the word amount and volume in terms of the market?

1 Answer 1

3

Neither is right, because both refer to a number of shares. "Volume" means the number of shares traded in a period (at various prices), "Amount" on an order book refers to the number of shares that the order wants to buy/sell.

I would not be surprised to see "volume" used in an order book, but I would not expect to see "amount" when talking about aggregate trading volume.

7
  • So I should say "I will sell an amount of 4 shares" and not "I will sell a volume of 4 shares". Right?
    – nimo23
    Oct 2, 2019 at 13:41
  • There are orderbooks which uses the word "amount" referring to the number of units. Or?
    – nimo23
    Oct 2, 2019 at 13:43
  • But which word is the right for the calculation result of Amount x Price per asset = ????
    – nimo23
    Oct 2, 2019 at 13:45
  • @nimo23 I've seen "size" most often, but I don't look at order books that closely. IT depends on the context what the right word for "amount * price" would be. What are you trying to accomplish? Are you writing a paper, or software, or something else?
    – D Stanley
    Oct 2, 2019 at 13:48
  • 1
    Because they are synonyms. Finance is full of different words that mean the same thing, and the same word that means different things depending on the context.
    – D Stanley
    Oct 2, 2019 at 14:05

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