TKL: Is market liquidity deteriorating? S&P 500 ETF, SPY, daily trading volume fell to 26.9 million on Tuesday, near the lowest in 14 years.

TKL: Is market liquidity deteriorating? S&P 500 ETF, SPY, daily trading volume fell to 26.9 million on Tuesday, near the lowest in 14 years.

SPY’s turnover has fallen over the last several months and remains well below last year’s average.

At the same time, S&P 500 futures volume has declined to its lowest since August 2021.

Such thin trading volumes can exacerbate the market’s swings in the wake of unexpected events.

Meanwhile, the Volatility Index, VIX, has averaged just 15 points year-to-date, the lowest average in 5 years.

Is market volatility set to spike?

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