Volume Ratio

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Definition of 'Volume Ratio'

The Volume Ratio is the number of messages submitted for each executed contract in a given product.

This ratio is calculated by some exchanges (typically futures and options exchanges such as the CME in order to prevent abuse and market manipulation.

Typically, a clearing firm will be fined if they allow their members to excessively place and withdraw orders on the exchange and cause a flood of unexecuted orders to potentially slow down the speed at which the exchange operates.

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