What are active stocks?

The term active stocks refers to corporate shares that are heavily traded on an exchange. Active stocks are frequently bought and sold, which means they have fairly high trading volumes. These stocks generally also have a large number of outstanding shares. Because they are heavily traded, active stocks often have low bid-ask spreads.

What drives high volume of trading for active stocks?

News developments, such as tender offers for the company or positive earnings, or a large number of shares outstanding drive the high volume of trading for active stocks. Active stock lists show investors stocks with the highest trade volume, the biggest gainers and losers, stocks with the highest daily volume, and the most active stocks by index.

What does active trading mean?

Traders who take part in active trading buy and sell stocks to profit from short-term price changes. Investors who trade actively do so through day trading, position trading, swing trading, and scalping. There is no benchmark to determine the volume of what can be considered an active stock.

Why are stocks actively traded?

Stocks may be actively traded because they have a large number of shares outstanding, or because of a special situation. For example, if there is a tender offer for the company or because of unexpected news. Active stock lists are a great way to help you in your investment strategy.