Glossary

Liquidity

Liquidity

DEFINITION OF 'Liquidity'

Liquidity is a measure of how easy it is to buy or sell an investment. 

An investment can be described as 'liquid' if it is easy to buy or sell; for example shares in FTSE 100 companies.

The level of liquidity may be lower in the case of small stocks or during periods when the market is in turmoil - making it harder to buy or sell an investment.