What does delivery percentage and volume traded mean and how to use it

Volume Traded: Volume traded for a script means total no of shares traded for the script in a particular trading day. Stocks with high volumes means the stock is liquid and traders showed more interest in buying and selling of that share.

Traders usually check stocks with higher volumes but that cannot be a single parameter to decide on investing into a stock. However high volumes with price change often give indication of a trading trend.

Delivery Percentage:

Delivery percentage in a script means % of shares which were not squared off the same day out of total shares traded. That means % of shares people actually took it into their demat account. Delivery based shares are not meant of intraday. It is generally for long term holding or positional trade.

A sudden increase in higher delivery percentage hints that people have showed interest to accumulate the shares for delivery and it’s not short lived.

Let’s understand with an example:

Suppose total volume of shares traded in a script ABC is 10000. Out of which 4000 were bought by traders and sold in the same day. Then the shares taken in delivery is 6000 and delivery percentage is 60%.

The delivery percentage and volume information are available in NSE/ BSE sites.

Spike in delivery percentage should be analysed with stock price change to analyse the short-term trend. Take a look into different scenarios below:

  • Increase in Delivery percent with increase in stock price: This indicates that buyers are expecting the stock price to go up and the sentiment is bullish about buying the stock.
  • Increase in Delivery percent with decrease in stock price: It shows a BEARISH trend in stock      price. That means the investors are offloading their positions in the stock and the downtrend will continue.

But as suggested the above two parameters should not be the only criteria to decide on whether to buy or sell a stock. Always one should rely on fundamental analysis for long term investment.

Hope you guys will be benefited with this precise explanation of delivery and volume.
Happy Investing!!!