Short answer: LTP stands for Last Traded Price, the price at which a stock was most recently bought or sold on the exchange. It changes with every executed trade during market hours and is updated in real time, so it is the number that moves on a screen as trading happens.
Last reviewed: 5 November 2026
At a glance
| Term | What it tells you |
|---|---|
| LTP (Last Traded Price) | The price of the most recent executed trade |
| Trading volume at the LTP | The number of shares that changed hands at that price |
| Liquid market | Frequent trades, so the LTP stays close to the true market price |
| Illiquid market | Fewer trades, so the LTP can be less reliable |
| Rising LTP | Generally signals buying pressure or positive sentiment |
| Falling LTP | Generally signals selling pressure or negative sentiment |
How is the LTP set?
An executed trade happens when a buy order and a sell order are matched on the exchange. A buy order is an instruction to purchase a stated number of shares at a stated price, and a sell order is the matching instruction to sell. The price of that matched trade becomes the new LTP.
Here is a hypothetical example, with invented figures for illustration only. Suppose a buy order for 100 shares at ₹500 is matched with a sell order, so the LTP becomes ₹500. Later, another buyer accepts a seller’s price of ₹505 for 50 shares, and the LTP moves to ₹505. The value of that second trade is 50 × ₹505 = ₹25,250.
What does the volume at the LTP tell you?
Volume is the count of shares traded. The trading volume at the LTP shows how many shares changed hands at that particular price. High volume helps confirm that the LTP is reliable, because the price was agreed on by many shares rather than a handful.
Using the same invented figures, a single 50-share trade at ₹505 is a thin basis for the LTP. If 5,000 shares had changed hands at ₹505, the trade value would be ₹25,25,000, or ₹25.25 lakh. The LTP is the same number in both cases, but the larger volume gives more weight to it.
Why does liquidity change how far you can trust the LTP?
Liquidity describes how frequently a stock trades. In highly liquid markets with frequent trades, the LTP stays close to the true market price. In illiquid markets, where trades are few, the LTP can be less reliable.
The catch is that one trade in a thinly traded stock can set a price that most participants would not agree with. Because the LTP is set by the last trade, a single unusual trade can be shown as the LTP until the next trade happens. Checking the volume at the LTP is one way to judge how much weight the number can bear.
What do a rising or falling LTP signal?
A rising LTP generally signals buying pressure or positive sentiment, meaning buyers are willing to pay higher prices than before. A falling LTP generally signals selling pressure or negative sentiment, meaning sellers are accepting lower prices.
These are descriptions of recent trading activity, not forecasts. A move over a few trades or a single session does not show where the price will go next. Treating the direction of the LTP as a prediction is a common mistake.
How do traders use the LTP, and what are the catches?
Traders use the LTP as a reference when they set limit orders. A limit order is an instruction to buy or sell only at a specified price or better. The LTP also helps traders choose entry and exit points, which are the prices at which they open or close a position.
The LTP is a record of a past trade, not a guaranteed price for the next one. The price shown on a screen can differ from the price at which a new order is actually filled, especially in illiquid stocks. Anyone using the LTP as a reference should check the volume and how often the stock trades before relying on it.
Frequently asked questions
Does the LTP change when no trades happen?
No. LTP changes with every executed trade during market hours, so it only moves when a buy order and a sell order are matched. If no trade takes place, the last traded price stays as it was.
Does a high LTP mean a share is a good buy?
The LTP only shows the price of the latest trade. A high or rising LTP generally signals buying pressure or positive sentiment, which describes trading activity rather than whether a share is worth buying.
Can the LTP be wrong?
The LTP is the price of an actual trade, so it is not a guess. In highly liquid markets it stays close to the true market price, but in illiquid markets it can be less reliable.
Sources and last check
Facts in this article were checked against the sources below on 5 November 2026. Rules and figures can change; check the primary source before acting.
- icicidirect.com (broker education)
- upstox.com (broker education)
- groww.in (broker education)
This article is general information, not investment advice. MyFinanceBandhu is not a SEBI-registered investment adviser.
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