#Liquidity101 Liquidity101 explains how easily an asset can be bought or sold without significantly affecting its price. Liquid assets, such as popular stocks or large cryptocurrencies, can be traded quickly, with small differences between the buying and selling price (spread). Liquidity is crucial for investors as it ensures quick access to funds and reduces risks. A low liquidity market implies slower transactions and higher costs. Factors such as trading volume, the number of participants, and market depth influence liquidity. Understanding the concept of Liquidity101 helps in making more efficient trading decisions.