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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?

nimo23
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1 Answers1

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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.

D Stanley
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  • 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 02 '19 at 13:41
  • There are orderbooks which uses the word "amount" referring to the number of units. Or? – nimo23 Oct 02 '19 at 13:43
  • But which word is the right for the calculation result of Amount x Price per asset = ???? – nimo23 Oct 02 '19 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 02 '19 at 13:48
  • I want to learn..I am little confused how amount and volume are used as if they are synonyms.. – nimo23 Oct 02 '19 at 13:52
  • The volume you are referring could be also called turnover if the volume corresponds to the market-volume and not to the volume one client holds, or? – nimo23 Oct 02 '19 at 13:53
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    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 02 '19 at 14:05