Liquidity refers to the speed with which an asset or security can be bought or sold in the market, without affecting its price—the ease of converting it to ready money, or cash. Cash is considered the most liquid of assets.
 | | Term of the Day | Words to Know | | |  | | Liquidity | Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market at a price reflecting its intrinsic value. In other words: the ease of converting it to cash.
Cash is universally considered the most liquid asset, while tangible assets, such as real estate, fine art, and collectibles, are all relatively illiquid. Other financial assets, ranging from equities to partnership units, fall at various places on the liquidity spectrum. | | Read More » | | Financial Liquidity | | Financial liquidity comes into play for companies, your personal finances, investing, and financial markets. But assets and investments have various levels. | | Read More » | | | SPONSORED BY INVESCO | | The Complete Guide to ETFs | | ETFs are becoming increasingly popular and soaring to new heights among investors. Invesco's insights can help you determine if these investment vehicles are right for you. | | Learn More » | | | Liquid Asset | | A liquid asset is an asset that can easily be converted into cash within a short amount of time. | | Read More » | | | Ask | | The ask is the price a seller is willing to accept for a security. The ask quote may state the amount of security to be sold at the ask price. | | Read More » | | | Bid-Ask Spread | | A bid-ask spread is the amount by which the ask price exceeds the bid price for an asset in the market. | | Read More » | | | | | | CONNECT WITH INVESTOPEDIA | | | | | | | |
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