#TradingPairs101 Liquidity refers to how quickly and easily an asset can be converted into cash without significantly impacting its market value. It's a key financial concept that enables individuals and businesses to meet short-term obligations, respond to emergencies, invest wisely, and avoid insolvency.

Why Is Liquidity Important?

Strong liquidity ensures financial flexibility and stability. It allows organizations and individuals to:

Pay off short-term debts

Seize investment opportunities

Handle unexpected expenses

Prevent financial distress or insolvency