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The depth of a market is a term that essentially applies to financial markets. It expresses the ability of such a market to absorb buy or sell orders for large amounts.
It participates in the liquidity of the market.
This is a concept that is particularly followed on Stock Exchanges because the vast majority of equities are medium-sized companies, less known to investors.
In the case of very big orders, it is necessary to be able to mobilize a large number of interested investors to answer them, or investors ready to invest large sums. It all depends on brokers' ability to quickly identify these potential participants.
In organized markets, it can be evaluated by the size of the order books, but it is only a basic indicator. More generally, brokers can assess the depth of the market to the number and size of investors who are likely to invest, and who therefore have a minimum of interest in the relevant market.
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