Liquidity, Trading Activity, and Stock Price Volatility

Purpose: While the bulk of previous research focused on security-level volatility and relationship its determinants, current study considers between number trades, lagged absolute returns, trading volume, bid-ask spread, price Zimbabwe stock market. Methods: The applied Hausman's (1982) tests specification. parameters elasticity explanatory variables have been estimated by utilizing Generalized Method Moments (GMM) procedure in a five-equation structural model. data were obtained from web-based financial market platform, Investing.com for period 2009 2021. Results: Results show that inflation had positive with volatility, which provided hedge against inflation. There exists an indistinguishable difference random effects (RE) fixed (FE) results those using Pooled Ordinary Least Squares (POLS) total sample reflecting cohesion these findings. Implications: Understanding risk (volatility) can be beneficial to investor selecting appropriate most convenient investment strategy. From policy-making perspective, strategic policy measures employed towards reducing would certainly reduce boost confidence.