Likviidsust
Likviidsust, or liquidity in Estonian, refers to the degree to which an asset or market can be converted into cash quickly and with minimal loss of value. It is a central concept in finance and economics, influencing asset pricing, risk management, and regulatory requirements. Liquidity is typically discussed in terms of market liquidity, which concerns the ease of buying or selling assets in the market, and funding liquidity, which concerns an institution’s ability to meet cash needs as they arise.
Market liquidity is shaped by market depth, trading volume, the number of participants, and the presence of
Funding liquidity refers to the ability to obtain cash to meet obligations, and is often assessed through
Examples illustrate the concept: government bonds and large-cap stocks are typically highly liquid, while real estate