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  1. Jun 27, 2024 · A liquid asset is an asset that can easily be converted into cash within a short amount of time. ... current assets are used to assess a company’s ability to cover its current liabilities with ...

    • Cash. Includes physical money (local and foreign currency) as well as the savings account and/or current account balances.
    • Cash equivalents. Cash equivalents are investment securities with a maturity period not exceeding a year. Examples include treasury bills, treasury bonds, certificates of deposit, and money market funds.
    • Marketable securities. Stocks, bonds, and exchange traded funds (ETFs) are examples of marketable securities with a high degree of liquidity. They can be sold easily and it usually takes just a few days to receive the cash from their sale.
    • Accounts receivable. Money owed to a business by its customers for goods and services provided makes up accounts receivable. The liquidity of accounts receivable varies.
  2. Jul 19, 2022 · Financial Liquidity By Asset Class . Cash is the most liquid asset, and companies may also hold very short-term investments that are considered cash equivalents that are also extremely liquid ...

    • Jim Mueller
  3. Jan 22, 2023 · An asset's liquidity is a function of how easily it can be converted into cash. In corporate finance, liquid assets are those that can be used to pay off debts in a hurry. The most common examples ...

    • Claire Boyte-White
  4. A liquid asset is cash on hand or an asset other than cash that can be quickly converted into cash at a reasonable price. In other words, a liquid asset can be quickly sold on the market without a significant loss of its value. Generally, liquid assets are traded on well-established markets with a large number of buyers and sellers.

  5. Aug 8, 2024 · The Takeaway. Liquid assets are assets that can be converted into cash relatively easily — typically with little or no loss in value. Liquid assets can include cash in a checking or savings account, money market accounts, or marketable securities like stocks, bonds, mutual funds, and ETFs. Liquid investments can play a surprisingly important ...

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  7. Apr 22, 2022 · Liquid assets are important because they can be used to pay for liabilities or any unexpected expenses after the assets are quickly converted into cash. Liquid Assets vs. Other Assets

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