Volumes in Trading – Risk of Trading in Low Liquidity Stocks

A market maker might place a bid for 100 shares near the last sale price and a bid for 1,000 at 10% below that price. If someone naively attempts to sell 1,000 shares at the market price, then they might only get what they expected for the first 100 and get 10% less for the rest. It is necessary to use limit orders for low-volume stocks if you want to avoid these losses.