VWAP (Volume-Weighted Average Price)
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The Volume-Weighted Average Price (VWAP) is a measurement that shows the average price of a security, adjusted for its volume.
It is calculated during a specific trading session by taking the total dollar value of trading in the security and dividing it by the volume of trades.
The formula for calculating VWAP is cumulative typical price x volume divided by cumulative volume.
The VWAP is a trading benchmark that represents the average price a security has traded at throughout the day and is important because it provides traders with pricing insight into both the trend and value of a security.