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Average Daily Trading Volume (ADTV)

Trading Term

Average Daily Trading Volume (ADTV) refers to the average number of shares or contracts traded in a security per day over a specified period, typically 30 or 90 days. It serves as an indicator of a security’s liquidity and trading activity.

Significance: A higher ADTV suggests that a security is more liquid, making it easier for investors to enter or exit positions without significantly impacting the price. Conversely, a lower ADTV may indicate less liquidity and potentially higher volatility.

Traders often use ADTV to assess the suitability of a security for their trading strategies. For example, a day trader might prefer securities with high ADTV to ensure quick execution of trades.

IBKR Context: Interactive Brokers provides real-time data on trading volumes, including ADTV, enabling clients to make informed decisions based on a security’s liquidity profile.

Using TWS

The Average Volume column can be added to both TWS and Mosaic platforms:

In Mosaic
  • Click the wrench icon in upper right corner of Watchlist
  • Select Settings
  • Under Available Columns, find “High/Low/Volume/History”
  • Select “Average Volume”
  • Click Add button
  • Click Apply then OK to save changes
In TWS Classic
  • Go to Edit > Global Configuration
  • Navigate to Trading Tools > Quote Monitor > Default Layout
  • Select “Market Data Columns” tab
  • Find “High/Low/Volume/History”
  • Select “Average Volume”
  • Click Add button
  • Click Apply then OK to save changes

This will display the 90-day average daily trading volume.

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