In financial markets, liquidity refers to the ease of dealing in a security Ð whether shares, options, warrants or some other instrument Ð and turning them into cash.
Investment Dictionary - Liquidity
The Liquidity term refers to the easy with which an asset can be converted into cash.
Cash and assets easily converted to cash are liquid assets, and liquidity is the extent to which an individual or firm can produce cash when necessary.
Liquidity and Market Size
Unlike other financial markets such as the London Stock Exchange, the forex spot market does not have a physical location or a central exchange.
a measure of the number of shares, or dollar value of shares traded daily. Mutual funds and other institutional buyers prefer high liquidity stocks so they can easily move in and out of positions.
News On Liquidity ...
Leverage ratio's provide investors and lenders with insight into a companies ability to meet its short term debt obligations.
The amount of trading activity, and thereby the ease with which you can get in and out of a market. Measured by volume (and open interest in the case of future markets). It is the capability to convert an asset to money quickly.
The degree of an asset's ability to be converted to cash at its fair market price ...
Liquidity Risk of OTC Stocks
by Slav Fedorov, Demand Media
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Liquidity Differences Between Stocks and Forex
By James Stanley, Forex Trading Instructor
The ability of a company to pay off its debt obligations is measured by liquidity ratios.
There can be no ironclad assurance that, at all times, a liquid market will exist for offsetting a futures contract that you have previously bought or sold.
Market liquidity is a business or economics term that refers to the ability to quickly buy or sell a particular item without causing a significant movement in the price. The term is usually shortened to liquidity.
In economics, a liquidity trap is a situation when the economy is stagnant and the interest rate is equal to, or slightly above, 0 percent.
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Trading Dictionary Terms and definitions for active trading, forex, futures, stocks, and options
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Can be high, with thousands of transactions being carried out on a continuous basis; or low, with only intermittent price-quote updates and transactions.
Liquidity: In terms of markets, liquidity generally refers to the ability to buy and sell assets quickly and in large volume without substantially affecting the asset’s price.
Liquidity in banking
Main article: Market liquidity § Banking ...
Liquidity theory of the term structure
A biased expectations theory that asserts that the implied forward rates will not be a pure estimate of the market`s expectations of Future interest rates because they embody a liquidity ...
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One of the most common questions new investors ask is, "If I invest in a home or in real estate, should I pay off the mortgage early?
Cash Flow Liquidity Ratio
Calculate Cash Flow Liquidity Ratio with our free online Cash Flow Liquidity Ratio Calculator.
Dark Pool Liquidity
Home Library Business & Finance Investment Dictionary ...
The ease and quickness with which assets can be converted to cash.
No profit, no liquidity
By Daniel P. Collins
A recent Bloomberg story highlighted how University of Chicago Professor Eric Budish is proposing a new electronic trading market structure for equities and derivatives.
Commodity market liquidity often correlates very well with commodity market trading profits. There are three benefits to traders in high commodity market liquidity. The first is that it is easier to enter and exit trades.
Market Size and Liquidity
Unlike other financial markets like the New York Stock Exchange, the forex spot market has neither a physical location nor a central exchange.
8) Understand how liquidity impacts the bid/ask spread
Very similar to #5 above. Higher options liquidity means higher trading volume, and thus, less variance when it comes to pairing up buyers and sellers.
How To Determine Options Liquidity?
Quite often I read articles which tell us that options liquidity can be measured by open interest.
Minimum Investments, Transaction Costs and Liquidity
The minimum investment for a mortgage security varies according to the structure of the offering, but most tranches sold to individual investors require a minimum investment of $1,000.
Winning traders make prices efficient and provide most liquidity. Utilitarian and futile traders effectively underwrite the winning traders' efforts.
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world of electronic trading and computerized trade-matching has allowed a proliferation of programmed high-frequency traders using among others highly sophisticated pattern recognition analysis to enter the trading arena under the guise of liquidity ...
Liquidity of a market refers to the volume of the current market, the liquidity is a term for how much buying and selling is taking place. The forex market is the most liquid market of all financial markets.
Liquidity generally refers to how easily a non-cash asset can be converted to cash. As an example: US Savings Bonds are generally very liquid. A large building, requiring months to sell, is generally considered not very liquid.
Liquidity refers to an investor's ability to convert an asset into cash. The faster the conversion the more liquid the asset. Illiquidity is a risk in that an investor might not be able to convert the asset to cash when most needed.
The degree of ease to convert an asset into cash.
A measure of how much dollar volume is required to move the stock's price up or down one percentage point.
Stock chart volume also shows us the amount of liquidity in a stock. Liquidity just simply refers to how easily it is to get in and out of a stock.
Liquidity - Refers to the number of buyers and sellers in the market willing to trade at any given time.
Liquidity Ratios: The Current Ratio and the Quick Ratio Explained
There are two liquidity ratios that are generally used to offer an insight into the liquidity of the firm. These are the Current Ratio and the Quick Ratio.
Liquidity / liquid Market:
The ease with which a security can be converted to cash in the marketplace without substantially affecting the assets price.
A market participant that is obliged to buy and sell less liquid securities that it is registered in. In the process, it facilitates trading and improves liquidity in those securities.
Working capital compares current assets to current liabilities, and serves as the liquid reserve available to satisfy contingencies and uncertainties.
Liquidity: The ease with which a stock may be bought or sold in volume on the marketplace without causing dramatic price fluctuations.
As mentioned before, outstanding shares of stocks are limited compared to the amount of a currency that might be out there floating around.
Liquidity: A function of volume and activity in a market. It is the efficiency and cost effectiveness with which positions can be traded and orders executed. A more liquid market will provide more frequent price quotes at a smaller bid/ask spread.
Liquidity: For the most part, ETFs help increase liquidity and trading of more illiquid assets. However, when liquidity suffers an extreme drop, the bid-ask spread of ETFs can significantly widen and ETF pricing can become difficult or impossible.
Liquidity: Refers to the ease with which an investment may be converted to cash at a reasonable price.
Load: Commissions charged to holders of mutual fund units. (See sales charge.) ...
Liquidity Risk is somewhat related to opportunity risk, though in a somewhat more tangible way. This is simply the risk that you will not have money available at the time you need it.
If you haven't already, go back and read "Why is Day Trading so Difficult - Reason #1. Trading high volume, liquid markets is an absolute must if you want to succeed.
Liquidity refers to the amount of transactions in a particular counter, the larger the volume of trading, higher the liquidity.
Listed securities ...
liquidity " the degree to which it is easy to buy or sell a stock in the market
margin account " a line of credit with a bank, broker or trust company where money is borrowed for investing while using investments as collateral ...
Liquidity: This refers to how easily securities can be bought or sold in the market. A security is liquid when there are enough units outstanding for large transactions to occur without a substantial change in price.
Liquidity Measurement of how easily an asset can be sold without affecting its price.
Listed security Stock or bond that is listed for trading on a major exchange or marketplace.
Liquidity: Market situation in which quick purchase or sale of a security is possible without causing substantial changes in prices.
Liquidity Ratios are a measure of a company's ability to cover its short term financial obligations. Can they pay the bills, the interest on any debt, etc.?
Liquidity - a market that allows for easy entry and exit of a position due to the large amount of volume
Low - lowest price that occurs for a trading period
Margin - effectively borrowed money ...
Sometimes you are not able to get out of your investment conveniently, and at a reasonable price. For example in 2008, you may have found it tough to sell your house at a price you wanted.
Liquidity - The ability of an insurance company to convert its assets to cash quickly.
With a daily trading volume that is many times larger than the New York Stock Exchange, there are always broker and dealers willing to buy or sell currencies in the Forex market.
Liquidity: The measure of how quickly an investment can be turned into cash. A mutual fund generally is considered a very liquid investment, because shares can be redeemed at any time. In contrast, a house is a very illiquid investment.
Liquidity- This is the ability of a trader to convert his assets to cash in a fast way.
Margin- This is a collateral willing to be issued by a trader to a broker when he wants to borrow funds.
A reserve fund for a company or person containing money market and highly liquid investments.
Living Will ...
Liquidity - The capability of ready conversion of an asset or investment to cash.
Market Price - The current price of the security in the market.
Market Risk - The possibility that the price of the security will change over time.
Liquidity - The ability of a market to accept large transactions.
- M - ...
Liquidity: a) The ability of an investment to be easily converted into cash with little or no loss of capital and minimum delay. An example of a highly liquid asset is a short term Treasury bill, while property is a relatively illiquid investment.
Liquidity risk: Liquidity risk refers to the risk of loss as a result of a lack of market liquidity, preventing quick or cost-effective liquidation of products, positions, or portfolios.
The ability to convert a security to cash quickly.
The fee charged by a mutual fund to investors to buy units (front-end load or acquisition fee) or sell units (back-end load or redemption fee).
The possibility to buy or sell a security in volume without big price fluctuations. A liquid stock is one with a high daily volume.
The liquidity of a stock is the ease with which the market can absorb volume buying or selling without dramatic fluctuation in price.
Locked or Crossed Quotations ...
Liquidity Agreement - Liquidity Agreement is an agreement that allows an asset holder to convert assets into cash.
Liquidity is the ability to easily sell or buy security or currency.
Long Position is currency purchase, when 'buy' position is opened.
Loss - reduction in deposit amount due to losses.
Liquidity: A general term used to indicate how easily transactions can be executed at or near a given price in a given issue or market. It often relates to the number of dollars required to effect a given price change.
The debt paying ability or dollar value of assets.
Ability to buy or sell asset quickly in large volume without substantially affecting the asset price.
Liquidity: Liquidity is the ease in which you can turn investments into cash. A liquid market is one where there are equal numbers of buyers and sellers that both can fulfil orders.
The volume of business that can be transacted in the market. Highly liquid markets typically have narrow spreads and can accommodate large deal sizes. Illiquid markets have wide spreads, small deal sizes and are often erratic.
The ability to convert an investment into cash quickly and with little or no loss in value.
Liquidity is how easily you may buy or sale an equity. The higher the volume, the more liquid. This is why you set filters on your stock scanning tool.
Liquidity - An asset that can be easily bought or sold is considered liquid. Money market funds are perhaps the most liquid asset.
Liquidity - the degree to which an asset or security can be bought or sold in the market without affecting the asset's price. Liquidity is characterized by a high level of trading activity.
Liquidity: Liquidity can have two meanings. 1. The ease by which you can sell a financial instrument and turn it into cash. 2. The amount of short term liquid assets a bank holds against its liabilities to ensure that it will not be insolvent.
A security is said to be liquid when investors can easily buy and sell the security, as a result of an abundance of buyers and sellers.
Liquidity - The ability of the market in a particular security to absorb a reasonable amount of buying or selling at reasonable price changes. Liquidity is one of the most important characteristics of a good market.
Liquidity Data Bank - A computerized profile of CBOT market activity, used by technical traders to analyze price trends and develop trading strategies.
Over 85% of all FX transactions involve seven major currencies (AUD, CAD, CHF, Euro, GBP, JPY and USD). In a 1.5 trillion dollar daily market, traders are usually able to get in or out of currency positions in the major currencies.
Liquidity aggregator: An agency broker (does not commit capital) that takes a client buy or sell order and contacts a variety of market makers.
Liquidity: The ease with which an asset can be converted to cash in the marketplace. A large number of buyers and sellers and a high volume of trading activity provide high liquidity.
Liquidity: For an investment, portfolio, or account, the ease with which assets may be converted into cash. For a market, the ability of the market to absorb fairly large volumes of sales without drastically affecting the price.
Liquidity Risk: Liquidity risk relates to whether an investment can be sold quickly at a fair market price when cash is needed. For example, long-term Treasury bonds are publicly traded and have excellent liquidity.
-Liquidity — the measure of markets which describes relationship between the trading volume and the price change.
Liquidity - A term used to describe how often a equity or option is traded. For options, liquidity can be measured using the volume of the option or the open interest.
Illiquidity Illiquid markets are typified by low levels of trading, with little underlying stock readily available. Buying and selling can cause exaggerated price fluctuations.
Given its relative newness, there is a flurry of ETNs hitting the market. They are, however, yet to engage the market players enthusiastically, several of whom are probably opting for the wait and watch approach.
See also: Market, Trading, Stock, Risk, Profit