Market Liquidity

In the field of business, economics, or investment, market liquidity is a characteristic of the market whereby people or companies can buy or sell assets quickly without causing drastic changes in asset prices. Liquidity involves the trade-off between the asset's selling price and the selling speed. In a liquid market, the trade-off is soft: people can sell quickly without having to accept a significantly lower price. In a relatively illiquid market, assets must be discounted to sell quickly.