How is 'turnover' defined in trading?

Turnover in trading refers to the frequency of buying and selling securities within a specific period. This metric is crucial for understanding market activity and participant engagement. High turnover often indicates a liquid market where securities are regularly exchanged, allowing traders to enter and exit positions with relative ease. It reflects how often an asset is traded, which can provide insights into its popularity and market demand.

In the context of the other options, while total profits from trades may provide insight into trading performance, it does not capture the concept of turnover, which is strictly about trading volume and activity rather than profitability. Similarly, although liquidity pertains to how easily assets can be traded without impacting their price, it is not directly equivalent to turnover – liquidity is a broader concept. Lastly, the average price of traded securities provides information about valuation but does not convey the trading frequency essential to understanding turnover. Thus, the definition that best encapsulates the concept of turnover is indeed the frequency of buying and selling securities.