What does liquid mean?

Jun 28, 2016 | Finance For Non Finance

Simply put it means how easy is it to covert your assets to cash.

Cash is the most liquid, as it is cash. You can use it to buy anything you want.

A gold ring is very liquid as it can be converted into cash on almost any high street in the World for an advertised price.

A car is less liquid. It can be converted to cash quite easily, by selling it.

How liquid your car is depends on how desirable it is and how much you want to sell it for.

The less desirable an asset is, and the longer it takes to find a buyer, the less liquid it is.

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