What does circulating supply tell you?

Could you elaborate on the significance of circulating supply in the context of cryptocurrencies? Specifically, how does it inform investors about the overall availability and liquidity of a particular digital asset? Does a high or low circulating supply indicate potential risks or opportunities? Additionally, how does it relate to other metrics like market capitalization and trading volume? I'm particularly interested in understanding how investors leverage this information to make informed decisions regarding their cryptocurrency portfolios.