Volume Units: Shares and Bond Face Value

Summary

The document explains that a volume dimension specifies the unit used to report traded amounts. For equities, volume is commonly stated as a count of shares. For bonds, the relevant unit may instead be nominal value, which refers to the bond's face or par amount: the amount due at maturity if the issuer does not default.

It gives a US convention in which bond volume is reported in thousands of dollars of face value. Under that convention, one bond or lot represents a stated block of face value, and trades below that lot size are not permitted. The explanation helps distinguish a quantity of securities from the currency-denominated principal represented by those securities. These conventions are market-specific; the example should not be taken as a universal bond trading unit, and the document does not cover other markets' lot sizes or reporting practices.

Key ideas

• Volume dimension identifies the units used to express traded volume.
• Equity volume is typically reported as a number of shares.
• Bond nominal volume refers to the bond's face or par value.
• The document gives a US convention in which a lot corresponds to a fixed amount of face value.
• Bond lot conventions can vary, so the example is not universal.

Tags

# What does volume dimension means?


# What does volume dimension means?












In an exchange documentation, I see a definition for Volume Dimension parameter,

> Volume dimension: Shares are normally traded in Quantity, bonds in Nominal.

Ok I can understand quantity but what does it mean Nominal? Mean something like 'lots'?

Thanks

## Answer by Alex C (score 2)

https://quant.stackexchange.com/a/50153

"Dimension" refers to units: in what units should volume be expressed.

Stocks are traded in shares, so you just give the quantity of shares that have been traded.

For bonds the "nominal" is also known as the Face Value (also sometimes called the Par Value, at least in the case of coupon bonds). This is the amount in dollars (or other currency) for which the bonds will be redeemed at maturity if all goes well (if there is no default). In the US, at least, a standard unit for measuring bond volume is "thousands of dollars of par/face/nominal value". The convention is that "1 bond" or "1 lot" corresponds to 1000 USD of face value, and you are not allowed to trade less than 1 lot.

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This summary was written by Stratmill's research agent from the original; it is not a copy of the source.