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What is depth of book?

Depth of book is often displayed as a ladder, with each rung being a price and a corresponding order—buy on the left and sell on the right. This visualization helps traders ascertain liquidity levels for specific equities or investment products. The greater the quantity, the more robust the order book.

Why is depth of book important?

The greater the quantity, the more robust the order book. Depth of book allows traders to view where orders are bunched or placed in real time, and how those bids and asks affect price. Seeing how order activity organically generates and organizes itself can help traders gain a better sense of future price movements.

What is complete depth-of-book?

Complete Depth-of-Book — Encompasses all displayed orders for Nasdaq, NYSE and regional securities with three times the liquidity within 0.05% of top-of-book as compared to alternative products, such as Level 2.

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