Liquidity

- refers to the ease with which an asset can be bought or sold in the market without causing a significant impact on its price.

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Liquidity

Types of Liquidity

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Market liquidity

Accounting liquidity

Types of Liquidity:

refers to the ease with which an asset can be bought or sold without affecting its price.

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Market liquidity

Types of Liquidity:

 refers to the ability of a company to meet its short-term obligations by converting its current assets into cash.

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Accounting liquidity

such as stocks and bonds, can be easily bought and sold in large quantities without significantly impacting the market price.

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Assets with high market liquidity

such as real estate and rare collectibles, can be more difficult to buy or sell, and the price may be more sensitive to changes in supply and demand.

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Assets with low market liquidity

 - describes the effort of investors or managers to reduce liquidity risk exposure

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Liquidity Management

Liquidity Management - describes the effort of investors or managers to?

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reduce liquidity risk exposure

-  occurs when an individual investor, business, or financial institution cannot meet its short-term debt obligations.

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Liquidity Risk

• means ‘Cash Crunch’ for a temporary or short-term period, and such situations generally have an adverse effect on any business and profit-making organization.

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Liquidity risk