Liquidity

1. An asset's ability to be turned into cash quickly without significant loss compared with current market value.

2. An entity’s ability to pay its obligations when they fall due, especially in the short term.

3. An entity's ability to source additional funds to meet its obligations.

4. A financial ratio designed to measure an entity's ability to meet its obligations when they fall due. For example, the current ratio or the quick ratio.

See also

• Authorisation
• Authority limits
• Cash forecasting
• Cash pool
• Current ratio
• Illiquid
• Liquidation
• Liquidity management
• Liquidity premium
• Liquidity risk
• Money management
• Quick ratio
• Solvency