Liquidity and slippage

The idea

Liquidity is the ability to trade size without moving price much. Slippage is the difference between an expected and actual execution price.

Try the scenario

Your simulated buy is expected near ₹100 but fills at ₹100.40.

Check your understanding

For that buy, this is…

• Adverse slippage of ₹0.40 per unit
• A guaranteed ₹0.40 profit
• The daily return

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