#Liquidity101 Liquidity refers to how easily and quickly an asset can be bought or sold without significantly affecting its price. High liquidity means there's a large number of buyers and sellers. You can trade quickly with tight spreads and minimal price impact. Low liquidity means fewer market participants. That leads to price slippage, wider spreads, and even failed orders during high volatility. Example of high liquidity includes major stocks like Apple or Google where trades execute quickly and efficiently. On the other hand, low liquidity assets can be challenging to trade without significant price movements, making it difficult for traders and investors.