InvestorQ : What insights you get from the daily delivery volumes in the market?
Ishita Jain made post

What insights you get from the daily delivery volumes in the market?

Answer
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Niti Shenoi answered.
2 years ago


This is reported on a daily basis and shows what percentage of the volume in the market is delivery based and what percent is speculative in nature. Currently, the ratio is around of 28%. Typically, market volumes that are squared off during the day are classified as delivery volumes and such delivery volumes can be on the buy side or the sell side. There are a few clear indications that emerge from the Delivery volumes.

Firstly, a sharp increase in delivery volumes supported by rise in stock prices is an indication of a build up of institutional interest in a stock, which is positive. Secondly, the trend in delivery volumes shows which way a particular sector is headed. Typically, we see delivery volumes picking up sharply ahead of a strong rally in stocks as the strong hands start accumulating in the market. Lastly, even on days when the index crashes if the delivery volumes are very high, it is a sign of delivery based selling. This is normally a signal of more downsides in the market to come.