Market color, which is not to be confused with sizing-up the volume, is a terminology normally used in the context of dealers and brokers describing the depth of market liquidity. It is also defined as the ensuing sentiment in the trading markets. The market color is commonly given by a broker to market participant dealers. The information that commonly describes the market color of a particular product normally includes the data of the posted prices, their respective volumes, and the number of sellers and buyers.
Market color on PhP Fixed Income market; the broker for Php Fixed Income Securities market makes the following announcement:
“5-67 Bid at 5.52%, Offer at 5.50%
200 million on the Bid; 50 million on the Offer
4 x 1 (representing 4 dealers on the Bid, only 1 dealer on the Offer