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Liquidity premium |
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Liquidity premiumForward rate minus expected future short-term interest rate.Liquidity premium Similar MatchesLiquidityLiquidityThe capicity to turn assets into cash, or the amount of assets in a portfolio that have that capacity. Cash itself (i.e., money) is the most liquid asset. Liquidity diversificationLiquidity diversificationInvesting in a variety of maturities to reduce the price risk to which holding long bonds exposes the investor. Liquidity crisisLiquidity crisisA financial crisis that occurs due to lack of liquidity. In international finance, it usually means that a government of central bank runs short of international reserves needed to peg its exchange rate and/or to service its foreign loans. Liquidity ratioLiquidity ratioSee 'acid test'. Liquidity trapLiquidity trapA situation in which expansionary monetary policy fails to stimulate the economy. As used by Keynes (1936), this meant interest rates so low that expectations of their increase made people unwilling to hold bonds. Today it usually means a nominal interest rate so near zero that lowering it further is impossible or ineffective. Further SuggestionsliquidityLiquidity Fund Liquidity preference hypothesis Accounting liquidity |
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