liquidity
Americannoun
-
the possession of sufficient liquid assets to discharge current liabilities
-
the state or quality of being liquid
Etymology
Origin of liquidity
From the Latin word liquiditās, dating back to 1610–20. See liquid, -ity
Explanation
Liquidity refers to a state where something is in liquid form, like water. It can also refer to having cash or access to cash. Liquidity means things are flowing. Although liquidity refers to…surprise! being a liquid, it’s usually used in a financial sense. Financially, liquidity refers to having access to cash or things you can sell and turn into cash. In other words, you have good cash flow. Liquidity can also apply to any situation that is marked by fluidity or runniness. You hope your new swimming pool is in a state of liquidity, and that you have enough financial liquidity to pay for it!
Vocabulary lists containing liquidity
Personal Finance and Financial Literacy - High School
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Economics
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Personal Finance and Financial Literacy - Middle School
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Example Sentences
Examples are provided to illustrate real-world usage of words in context. Any opinions expressed do not reflect the views of Dictionary.com.
“Our capital position and liquidity remain strong, and our financial strength ratings are unchanged,” Group 1001, the insurers’ parent company, said in a statement.
From Los Angeles Times ● Jul. 28, 2026
Over the years, the S&P 500 and the cross-currency basis swap have moved in lockstep on multiple occasions, with periods of strong hedging demand coinciding with falling U.S. equity prices as liquidity shifted.
From MarketWatch ● Jul. 23, 2026
Moreover, these "gigantic deals can already drain liquidity from the market and may create situations in which there is more supply than demand," weighing on prices, said PwC's Kubisa.
From Barron's ● Jul. 23, 2026
Wellington will provide active equity and liquidity management, while Blackstone is managing all of the private assets.
From The Wall Street Journal ● Jul. 22, 2026
“Bear was able to show us liquidity in the CDOs that I couldn’t understand,” said Ben.
From "The Big Short" by Michael Lewis
Definitions and idiom definitions from Dictionary.com Unabridged, based on the Random House Unabridged Dictionary, © Random House, Inc. 2023
Idioms from The American Heritage® Idioms Dictionary copyright © 2002, 2001, 1995 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company.
