Liquidity preference

1.

A desire to hold money in liquid form, for example cash or bonds.

This may be due to the transactions motive, the precautions motive or the speculative motive.

2.

More broadly, a preference of investors to invest in shorter-term and more liquid assets.

See also

• Liquidity
• Maturity transformation
• Precautions motive
• Speculative motive
• Transactions motive