#Liquidity101

Liquidity refers to the ease with which an asset can be bought or sold without significantly affecting its price. High liquidity means that there are many buyers and sellers in the market, allowing for quick transactions at fair prices. Liquidity is important because it reduces the risk of large price fluctuations and allows traders to enter and exit the market with ease. Assets with low liquidity can be more volatile and difficult to trade. Liquidity is key for efficient and secure operations in financial markets.