Arjun, a 29-year-old IT professional, had recently stepped into the world of stock markets.
He wasn’t a full-time trader. Just someone who wanted his savings to grow faster than a fixed deposit.
One morning, before heading to work, he opened Flattrade. A small-cap stock he had been tracking was trending online.
The chart looked strong. Momentum was building.
“This could be it,” he thought.
He placed a buy order.
Executed instantly.
That smooth execution felt reassuring.
Over the next ten days, the stock rose more than 10%. His portfolio glowed green.
He felt smart.
Then volatility returned.
Markets swung sharply. News turned negative.
Arjun decided to book profits.
He opened the app.
Clicked Sell.
Confirmed the order.
And waited.
The order stayed pending.
He refreshed the screen.
Still pending.
That’s when he noticed something he had ignored before – trading volume was extremely low. Very few buyers were active.
The bid-ask spread was wide.
The stock showed ₹148.
But the nearest buyer was at ₹136.
To exit immediately, he had to accept a ₹12 difference.
The stock didn’t lack potential.
It lacked liquidity.
What Is Liquidity?
Liquidity is how easily you can buy or sell a stock without significantly impacting its price.
Highly liquid stocks:
- Have constant buyers and sellers
- Show tighter bid-ask spreads
- Execute orders quickly
Low-liquidity stocks:
- Have fewer participants
- Show wider spreads
- Can be difficult to exit during volatility
Arjun had asked only one question:
“Will this stock go up?”
He forgot the more important one:
“Can I exit easily when I need to?”
Liquidity isn’t exciting. It doesn’t trend. It doesn’t double overnight.
But during uncertainty, liquidity becomes everything.
Without liquidity:
- Stop losses may not execute properly
- Price impact can be sharp
- Exiting quickly becomes difficult
With liquidity:
- Orders execute faster
- Price impact is lower
- You retain flexibility
In markets, everyone talks about entry.
Very few talk about exit.
But investing is not just about choosing the right stock.
It’s about having the freedom to leave when you decide.
And that freedom comes from liquidity.
Flattrade provides real-time market depth, volume visibility, and quick order execution tools – helping investors assess not just price, but liquidity before placing trades.
Because informed execution matters.
