Finance is a branch of science that encompasses an array of economic and financial principles, aiming to increase the value of an individual, business company, or public entity. It focuses on money and the level of risk associated with many of the financial ventures. Finance studies and explains the processes through which money is saved, used, or spent.
Personal finance explores the application of a variety of financial principles to persons and family units. It deals with how the money is obtained and how it is spent. The process of decision making is often associated with time and level of risk. Personal finance involves credit cards, personal loans, bank accounts, insurance policies, tax management, and personal investments.
Corporate finance deals with the task of administering funds for the corporation's different activities. At the level of corporate finance, financial concepts are applied to increase the overall value of the company. As part of the process, the decision makers also take into account the management of risks. All business entities deal with and try to predict potential risks. It is the elimination of these risks that determine whether or not a company will be ultimately successful on the market.
Finance covers three major areas: investments, financial markets and institutions, and investments. Financial management deals with how a business entity or an individual budgets or allocates funding in order to ensure a sufficient inflow of cash. This involves maintaining and administrating a person's or a business's financial assets. The companies hire financial managers to assess the financial circumstances of the business and to come up with strategies to increase profit generation. Financial management is the task of one manager or a team of experts. The cash flow of the business depends on the performance of this individual or group.
There are various financial institutions among which investment funds, insurance companies, credit unions, and banks. These bodies work as intermediaries for both capital markets and debt markets, and lenders and borrowers. They help facilitate the flow of cash from businesses, investors, clients, and many other entities. Financial institutions operate to provide financing to businesses, earning profit as part of the lending process. These institutions also provide financial security in different forms such as savings and insurance. Financial markets provide the tools for people to buy and sell services and products. These can be various commodities and goods. Thanks to the existence of markets, sellers and buyers meet each other. Financial markets facilitate international trade, the raising of funds, and the transfer of financial risks.
Budgets document the company's plan and may include the objectives of the business entity, the set targets, financial results, the required investment level to achieve the planned sales, and the funding sources. While long term budgets span over 5 to 10 years, short-term budgets focus on the functioning of businesses during one financial year.
Investments allow individuals or companies to buy assets in exchange for profit in various forms, for example income, interest, or appreciation. Financial management and the management of risks also play role in investments. The careful ROI and investment analysis will bring positive results to the companies and individuals who venture in the field of investment. All fields of finance are interrelated. Individuals who specialize in different branches of finance typically have working knowledge that spans over the whole science of investment.
Tuesday, June 15, 2010
Friday, June 4, 2010
Debt Consolidation FAQ
Debt consolidation is simply a method for creating an umbrella under which to place all outstanding debts into one new large loan or repayment program and proceeding with payoffs. There are a couple methods to use to accomplish this task.
Consolidating debt into a larger loan
This is where you obtain money from family, friends or a financial loan institution such as a bank or credit union in an amount large enough to pay off all the debt you wish to consolidate. By doing this you are left with a single loan, which will make managing your finances easier. It clears the deck, so to speak, of the old debt load. It replaces the old debts with one much larger new debt. In reality, you may end up paying more by the time you are done with the debt consolidation than you would have under the separate bills. This is due to taking a longer time for repayment and possibly having more interest in the final accounting. Even if you end up paying more, debt consolidation may allow you to improve your credit score and get on the path of financial health. Consolidating your debt will make budgeting easier, as you will deal with one single payment monthly.
A debt consolidation program.
You can do this via third-party, which can be a non-profit organization. They negotiate with the lenders you owe money to, trying to lower your interest rates, reduce the interest you already owe, and in some cases lower the loan principal. They can also propose a debt settlement plan, in which your creditors accept lower repayment installments. One thing to remember when using a debt consolidation program is that you still need to keep your spending under control. If you keep overspending, You don't stand a chance in your efforts to eliminate debt.
Do-it-yourself approach to debt consolidation
You may want to seek out and obtain a new credit account that is large enough to transfer the old debts over to, if your credit record is still in good shape. If you have damaged credit, the chances of getting a very large new credit account would be very slim to non-existent.
However debt is repaid, debt consolidation means that you bring all debt into a new form. The old financial obligations are retired and substituted for a larger loan, easier to manage.
Disclaimer: This article is provided for educational and informational purposes only and should not be considered a substitute for professional and/or financial advice. The information found in this article is provided "AS IS", and all warranties, express or implied, are disclaimed by the author.
Consolidating debt into a larger loan
This is where you obtain money from family, friends or a financial loan institution such as a bank or credit union in an amount large enough to pay off all the debt you wish to consolidate. By doing this you are left with a single loan, which will make managing your finances easier. It clears the deck, so to speak, of the old debt load. It replaces the old debts with one much larger new debt. In reality, you may end up paying more by the time you are done with the debt consolidation than you would have under the separate bills. This is due to taking a longer time for repayment and possibly having more interest in the final accounting. Even if you end up paying more, debt consolidation may allow you to improve your credit score and get on the path of financial health. Consolidating your debt will make budgeting easier, as you will deal with one single payment monthly.
A debt consolidation program.
You can do this via third-party, which can be a non-profit organization. They negotiate with the lenders you owe money to, trying to lower your interest rates, reduce the interest you already owe, and in some cases lower the loan principal. They can also propose a debt settlement plan, in which your creditors accept lower repayment installments. One thing to remember when using a debt consolidation program is that you still need to keep your spending under control. If you keep overspending, You don't stand a chance in your efforts to eliminate debt.
Do-it-yourself approach to debt consolidation
You may want to seek out and obtain a new credit account that is large enough to transfer the old debts over to, if your credit record is still in good shape. If you have damaged credit, the chances of getting a very large new credit account would be very slim to non-existent.
However debt is repaid, debt consolidation means that you bring all debt into a new form. The old financial obligations are retired and substituted for a larger loan, easier to manage.
Disclaimer: This article is provided for educational and informational purposes only and should not be considered a substitute for professional and/or financial advice. The information found in this article is provided "AS IS", and all warranties, express or implied, are disclaimed by the author.
Tuesday, May 25, 2010
Is getting a bad credit loan in Canada easy?
A bad credit is not something one ought to be ashamed of, particularly now in the circumstances of global financial insecurity and market stagnation. Among other uses you have in mind, bad credit loans may help you obtain a mortgage, purchase new estate, or purchase a second home. You can furthermore pay off other loans or credit card debt. If you live in Canada and are looking for a loan to fix your tarnished credit score, you have to shop around and find a lender that could meet your needs for financing.
You might have late or overdue payments on your mortgage that in turn were made by an unexpected job loss or some other unfortunate event, or missed payment on your auto loan or credit card. The first thing that comes to mind when considering of how to obtain a loan with that lousy blot on your credit record is applying for financing with one of the many sub-prime lenders. They have mushroomed across the county since the Canadian economy started giving in to the external financial shocks. Some banks give credit just to customers with good credit scores. However, other lenders are actually vying for your small business. The guide below will seek to save you some money and possible financial woes by looking for some reasonable financial establishments. The first two operate on the margin between prime and sub-prime lenders and would not rip off your pocket with mind-blowing interest rates.
CreditAxis is a financial services provider which has specialized in financing people with bad credit records in the United States and Canada. The devoted officials of CreditAxis are ready to help you remedy your damaged credit score or provide the financial assistance you require to overcome your current financial troubles. The maximum amount you may apply for is $25,000. The provider provides access to bad credit card deals, bad credit student loans, bad credit equity loans, fast cash loans, bed credit debt consolidation loans, auto loans, etc. You may obtain a lifetime membership with CreditAxis for $35 onetime fee that is payable by credit card or cheque.
ThinkCash is yet another bad credit loans provider which has specialized in providing short-term small loans ranging from just $250 to $2,500 to risky borrowers from Canada. The financing is supplied by the First Bank of Delaware with which the company is affiliated. Customers enjoy fast approval process while no paperwork or waiting in line is involved. The maximum sum that a first-time borrower may apply for is $1,000. Regular customers may borrow between up to $2500. Borrowers may pay their debt in several installments or as a lump sum. There is no penalty for full repayment of the loan, and you may choose when to do it. But, the faster you pay off the loan, the smaller the interest rate on the borrowed total. It is advisable to think twice before selecting ThinkCash, because the annual percentage rate (APR) on a loan of $1,000 is as high as 219.4%, believe it or not! So, consider this option only if you if you need a short term loan that will help you cover emergencies and unexpected events.
Canada-based Credit loan is another bad credit lender available to residents of Canada. Its loan portfolio includes consumer loans and cash advances with immediate approval. They go from just $1,000 to more substantial housing loans and other financing solutions. The company also offers credit repair and debt consolidation services and it does not charge a membership fee.
You might have late or overdue payments on your mortgage that in turn were made by an unexpected job loss or some other unfortunate event, or missed payment on your auto loan or credit card. The first thing that comes to mind when considering of how to obtain a loan with that lousy blot on your credit record is applying for financing with one of the many sub-prime lenders. They have mushroomed across the county since the Canadian economy started giving in to the external financial shocks. Some banks give credit just to customers with good credit scores. However, other lenders are actually vying for your small business. The guide below will seek to save you some money and possible financial woes by looking for some reasonable financial establishments. The first two operate on the margin between prime and sub-prime lenders and would not rip off your pocket with mind-blowing interest rates.
CreditAxis is a financial services provider which has specialized in financing people with bad credit records in the United States and Canada. The devoted officials of CreditAxis are ready to help you remedy your damaged credit score or provide the financial assistance you require to overcome your current financial troubles. The maximum amount you may apply for is $25,000. The provider provides access to bad credit card deals, bad credit student loans, bad credit equity loans, fast cash loans, bed credit debt consolidation loans, auto loans, etc. You may obtain a lifetime membership with CreditAxis for $35 onetime fee that is payable by credit card or cheque.
ThinkCash is yet another bad credit loans provider which has specialized in providing short-term small loans ranging from just $250 to $2,500 to risky borrowers from Canada. The financing is supplied by the First Bank of Delaware with which the company is affiliated. Customers enjoy fast approval process while no paperwork or waiting in line is involved. The maximum sum that a first-time borrower may apply for is $1,000. Regular customers may borrow between up to $2500. Borrowers may pay their debt in several installments or as a lump sum. There is no penalty for full repayment of the loan, and you may choose when to do it. But, the faster you pay off the loan, the smaller the interest rate on the borrowed total. It is advisable to think twice before selecting ThinkCash, because the annual percentage rate (APR) on a loan of $1,000 is as high as 219.4%, believe it or not! So, consider this option only if you if you need a short term loan that will help you cover emergencies and unexpected events.
Canada-based Credit loan is another bad credit lender available to residents of Canada. Its loan portfolio includes consumer loans and cash advances with immediate approval. They go from just $1,000 to more substantial housing loans and other financing solutions. The company also offers credit repair and debt consolidation services and it does not charge a membership fee.
Monday, May 10, 2010
How To Refinance Your Mortgage?
A vast majority of homeowners are paying too much interest every month due to the fact that their mortgage has not been refinanced lately, and the drastic decrease in the payment could quite possibly help strengthen their financial situation. A lower interest rate can free up additional cash flow monthly, and it also can help consumers pay off their home quicker by applying more money directly to the principal of the loan. The good news is that it is not hard to refinance your mortgage and these steps will help considerably in the process.
Homeowners need to understand that the changing housing market is certainly going to impact the value of their home, but this is normally only of concern to individuals that owe a significant portion of the estimated worth. Consumers with plenty of equity don't need to worry about being able to borrow against their home. It is never a bad idea to have an independent appraiser take a look at the property and give an estimated guess as to what the home will appraise for. The interest rates will be much higher for a loan that is based on less equity in the home.
An important part of the refinancing process is making sure that the best deal possible is obtained, and it is necessary to realize that most Canadian banks are known for rewarding loyalty. Customers that already have an existing relationship with the financial institution will find it much easier to borrow. The associated terms and interest rates will most likely be lower as well.
An individual's credit score is going to influence the lending decision of the bank, but there may be more leeway than most people believe. Any negative history present on the credit report should be explained in detail. References should be provided if at all possible, and employment stability should be proven by pay stubs or a letter of reference.
Homeowners should refinance their mortgage if it makes financial sense, so it is critical that all fees and costs are not too high. As long as the new loan is going to be paid off in the same amount of time or quicker, a person normally stands to gain by refinancing their current loan. Contacting the existing lender can often make for a fairly easy process, and in some cases a full application won't even be required. Certain programs may exist that will enable existing clients to redo the terms of their mortgage without refinancing the entire loan.
Refinancing your mortgage does not have to be a difficult process, and following the above best practices is an excellent way to accomplish the task. Successful refinances can help improve the overall financial picture of a family and make the future brighter.
Disclaimer: This article is provided for educational and informational purposes only and should not be considered a substitute for professional and/or financial advice. The information found in this article is provided "AS IS", and all warranties, express or implied, are disclaimed by the author.
More information about Refinancing here:
http://www.financialdictionary.net/
http://www.mortgagedictionary.net/
http://www.yourloan.ca/
Homeowners need to understand that the changing housing market is certainly going to impact the value of their home, but this is normally only of concern to individuals that owe a significant portion of the estimated worth. Consumers with plenty of equity don't need to worry about being able to borrow against their home. It is never a bad idea to have an independent appraiser take a look at the property and give an estimated guess as to what the home will appraise for. The interest rates will be much higher for a loan that is based on less equity in the home.
An important part of the refinancing process is making sure that the best deal possible is obtained, and it is necessary to realize that most Canadian banks are known for rewarding loyalty. Customers that already have an existing relationship with the financial institution will find it much easier to borrow. The associated terms and interest rates will most likely be lower as well.
An individual's credit score is going to influence the lending decision of the bank, but there may be more leeway than most people believe. Any negative history present on the credit report should be explained in detail. References should be provided if at all possible, and employment stability should be proven by pay stubs or a letter of reference.
Homeowners should refinance their mortgage if it makes financial sense, so it is critical that all fees and costs are not too high. As long as the new loan is going to be paid off in the same amount of time or quicker, a person normally stands to gain by refinancing their current loan. Contacting the existing lender can often make for a fairly easy process, and in some cases a full application won't even be required. Certain programs may exist that will enable existing clients to redo the terms of their mortgage without refinancing the entire loan.
Refinancing your mortgage does not have to be a difficult process, and following the above best practices is an excellent way to accomplish the task. Successful refinances can help improve the overall financial picture of a family and make the future brighter.
Disclaimer: This article is provided for educational and informational purposes only and should not be considered a substitute for professional and/or financial advice. The information found in this article is provided "AS IS", and all warranties, express or implied, are disclaimed by the author.
More information about Refinancing here:
http://www.financialdictionary.net/
http://www.mortgagedictionary.net/
http://www.yourloan.ca/
Wednesday, April 14, 2010
Debt Management or Debt Consolidation
Borrowers who can’t keep up with their monthly payments have important decisions to make. They have to figure out which is better: to manage their debt and thus keep it under control or to consolidate it and make it more manageable in this way.
Management or Consolidation?
Cruel as it may sound, debt builds against the financial health of a private person just like the cancer spreads inside the patient’s body. In this line of thought, debt management is applicable when your debt is still manageable, that is, while it could be controlled by means of careful budgeting and responsible planning of the expenses. There are quite a few financial institutions, including virtually all big banks in Canada and the United States, which provide flexible and secure debt management services to their costumers. Essentially, debt management boils down to somebody else’s taking control of your financial situation so as to save you from your own habit of building debt. Its ultimate goal is debt reduction and, in time, debt elimination. Before starting your search for a debt management provider, note that most of the really good debt managers know their price and their services are everything but cheap.
When does debt consolidation come in handy?
Debt management may be compared to some kind of medical treatment meant to prevent the financial cancer in the form of debt from spreading further. Debt consolidation, on the other hand, comes in handy when one already finds it difficult to keep track of numerous debts that he or she has accumulated. It is likely that the borrower will keep on building them avalanche-like in the future, leading in the end to financial collapse, which is also known as bankruptcy.
How does debt consolidation work?
Debt consolidation helps make your debts more manageable by paying off your numerous old debts with one single fresh and often larger debt. If you come to think about it, this could save you tons of cash on interest rates and late payment charges. Instead of paying off many credit cards or consumer loans each month, some of which you are very likely to forget about and incur penalty charges, you will be making one single payment that will cover all your smaller debts.
Debt consolidation isn’t easy to get
When applying for debt consolidation, you practically go to some provider of financial services and tell him: “Look, I have built a startling amount of small and useless debts that are like a millstone on my neck, but if you give me this large loan that I am applying for, I promise to get rid of them and be a good payer in the future.” Will you believe it, if it were you in the banker’s shoes? Probably not but in fact, there are many financial companies on the market whose job it is to help people pay off their debts by means of debt consolidation. All you have to do is shop around for a reliable lender with reasonable interest rates and convince it that you are not going to screw it up again. Good luck!
Information on more debt and bankruptcy and financial terms
Disclaimer: This article is provided for educational and informational purposes only and should not be considered a substitute for professional and/or financial advice. The information found in this article is provided "AS IS", and all warranties, express or implied, are disclaimed by the author.
Management or Consolidation?
Cruel as it may sound, debt builds against the financial health of a private person just like the cancer spreads inside the patient’s body. In this line of thought, debt management is applicable when your debt is still manageable, that is, while it could be controlled by means of careful budgeting and responsible planning of the expenses. There are quite a few financial institutions, including virtually all big banks in Canada and the United States, which provide flexible and secure debt management services to their costumers. Essentially, debt management boils down to somebody else’s taking control of your financial situation so as to save you from your own habit of building debt. Its ultimate goal is debt reduction and, in time, debt elimination. Before starting your search for a debt management provider, note that most of the really good debt managers know their price and their services are everything but cheap.
When does debt consolidation come in handy?
Debt management may be compared to some kind of medical treatment meant to prevent the financial cancer in the form of debt from spreading further. Debt consolidation, on the other hand, comes in handy when one already finds it difficult to keep track of numerous debts that he or she has accumulated. It is likely that the borrower will keep on building them avalanche-like in the future, leading in the end to financial collapse, which is also known as bankruptcy.
How does debt consolidation work?
Debt consolidation helps make your debts more manageable by paying off your numerous old debts with one single fresh and often larger debt. If you come to think about it, this could save you tons of cash on interest rates and late payment charges. Instead of paying off many credit cards or consumer loans each month, some of which you are very likely to forget about and incur penalty charges, you will be making one single payment that will cover all your smaller debts.
Debt consolidation isn’t easy to get
When applying for debt consolidation, you practically go to some provider of financial services and tell him: “Look, I have built a startling amount of small and useless debts that are like a millstone on my neck, but if you give me this large loan that I am applying for, I promise to get rid of them and be a good payer in the future.” Will you believe it, if it were you in the banker’s shoes? Probably not but in fact, there are many financial companies on the market whose job it is to help people pay off their debts by means of debt consolidation. All you have to do is shop around for a reliable lender with reasonable interest rates and convince it that you are not going to screw it up again. Good luck!
Information on more debt and bankruptcy and financial terms
Disclaimer: This article is provided for educational and informational purposes only and should not be considered a substitute for professional and/or financial advice. The information found in this article is provided "AS IS", and all warranties, express or implied, are disclaimed by the author.
Wednesday, March 3, 2010
6 Ways to Protect Your Wealth and Lifestyle in a Financial Crisis (Canadian Edition)
Financial crisis happens to even the most wealthy and careful of people. Maybe it’s a downturn in the economy, an unforeseen problem in your business, or maybe you broke up from a partner. Whatever it is it’s important to have measures in place in case you can’t keep you wealth and current lifestyle. These 6 tips should come in handy.
1.Make sure you bank account is insured with the Canada Deposit Insurance Corporation. They protect you up to $100,000 for all financial services offered by chartered Canadian banks.
2.If you need to remortgage your home, so be it. If it keeps you from going under in the short term you have time to map out your financial situation and hopefully get back on track. You may be able to lock in a better rate.
3.Budget. Pride is a counterproductive emotion when it comes to finances. So what if you can’t eat at the fanciest restaurants for a few months, it’s better than getting in to irreparable debt and not being able to eat at them ever again. Go for a cheaper bank account, reassess your car and home insurance options; even do the little things like turning off standby on electronic equipment.
4.Act sooner rather than later. The world economy doesn’t look too bright. It can only go up from hear right? Wrong, it might hit rock bottom first. Sort out debt before it is too late. Security comes before luxury. A good way to keep yourself afloat is to stop using credit cards and use debit cards. Then you can only ever be in the positive.
5.Save! Take a percentage of your income and put it aside EVERY month. You’ll eventually get in to the mindset that the percentage isn’t disposable income anymore. You’ll eventually have a nice nest egg for unforeseen circumstances. Make sure you use a high interest bank account with easy access. There are many online savings accounts that have no restrictions but good rates.
6.Spend less than you earn. Sounds simple right? But many people live on credit or spend before their wage comes in.
A lot of this is common sense and there are many other techniques you can use to keep yourself secure. Just because you traditionally earn a lot doesn’t mean you have to spend a lot.
1.Make sure you bank account is insured with the Canada Deposit Insurance Corporation. They protect you up to $100,000 for all financial services offered by chartered Canadian banks.
2.If you need to remortgage your home, so be it. If it keeps you from going under in the short term you have time to map out your financial situation and hopefully get back on track. You may be able to lock in a better rate.
3.Budget. Pride is a counterproductive emotion when it comes to finances. So what if you can’t eat at the fanciest restaurants for a few months, it’s better than getting in to irreparable debt and not being able to eat at them ever again. Go for a cheaper bank account, reassess your car and home insurance options; even do the little things like turning off standby on electronic equipment.
4.Act sooner rather than later. The world economy doesn’t look too bright. It can only go up from hear right? Wrong, it might hit rock bottom first. Sort out debt before it is too late. Security comes before luxury. A good way to keep yourself afloat is to stop using credit cards and use debit cards. Then you can only ever be in the positive.
5.Save! Take a percentage of your income and put it aside EVERY month. You’ll eventually get in to the mindset that the percentage isn’t disposable income anymore. You’ll eventually have a nice nest egg for unforeseen circumstances. Make sure you use a high interest bank account with easy access. There are many online savings accounts that have no restrictions but good rates.
6.Spend less than you earn. Sounds simple right? But many people live on credit or spend before their wage comes in.
A lot of this is common sense and there are many other techniques you can use to keep yourself secure. Just because you traditionally earn a lot doesn’t mean you have to spend a lot.
Wednesday, February 24, 2010
What are liquid assets?
The term liquid asset refers to financial resources that can be converted to cash with relative ease. This type of assets covers cash, US treasury bills, money market mutual funds, bonds, stocks, etc. In some states, precious metals such as silver and gold are also regarded as liquid assets. Money is the most liquid assets of all. Investments in the futures and stock markets are more liquid than investments in residential property. In fact, the most liquid market is the foreign exchange market because huge amounts of money change hands every day. In this sense, a single person or company cannot influence the exchange rate.
A characteristic feature of liquid assets is that they are readily saleable on the market. There is a high degree of certainty about the value of liquid assets: the price level of the next sale is typically close to the level of the last trade.
In simple words, a liquid asset is one that can be exchanged efficiently for another good or asset. Assets are described as liquid if they are sold quickly and with no loss of value. For example, one may be able to sell his car or house on eBay in a couple of hours, but there is a good chance that the assets would be sold for less that they are worth. Assets such as real estates and houses take longer to sell at a reasonable market price and are less liquid. Fixed or illiquid assets are not readily saleable as there are no markets to regularly trade them on (or their value is hard to determine).
In personal finance, liquid asset (apart from cash, funds in checking accounts, etc) is any item that may be sold at a fair market price is a short amount of time. These may be appliances, CDs, collectibles, and anything else that brings a good amount of money fast. In the world of business, liquid assets are the assets which a company can sell or trade quickly: cash, stocks, bonds, and funds in banks. Companies have to dispose of liquid assets in order to keep up with their payments. Businesses that do not have an adequate amount of liquid assets can go bankrupt because of a cash flow crisis. However, if a company has too many liquid assets, it is not profiting from these resources by investing them.
Market makers, together with speculators, are the major contributors to assets’ liquidity. These are companies and individuals seeking to make profit from the rising and falling prices of particular assets. They dispose of and provide capital which increases liquidity.
Central banks are key players when it comes to increasing the liquidity of money. They implement various monetary policies to exert control over the monetary supply of the country. Central banks buy and sell government securities and other financial instruments and use interest and exchange rates to implement monetary policy.
A characteristic feature of liquid assets is that they are readily saleable on the market. There is a high degree of certainty about the value of liquid assets: the price level of the next sale is typically close to the level of the last trade.
In simple words, a liquid asset is one that can be exchanged efficiently for another good or asset. Assets are described as liquid if they are sold quickly and with no loss of value. For example, one may be able to sell his car or house on eBay in a couple of hours, but there is a good chance that the assets would be sold for less that they are worth. Assets such as real estates and houses take longer to sell at a reasonable market price and are less liquid. Fixed or illiquid assets are not readily saleable as there are no markets to regularly trade them on (or their value is hard to determine).
In personal finance, liquid asset (apart from cash, funds in checking accounts, etc) is any item that may be sold at a fair market price is a short amount of time. These may be appliances, CDs, collectibles, and anything else that brings a good amount of money fast. In the world of business, liquid assets are the assets which a company can sell or trade quickly: cash, stocks, bonds, and funds in banks. Companies have to dispose of liquid assets in order to keep up with their payments. Businesses that do not have an adequate amount of liquid assets can go bankrupt because of a cash flow crisis. However, if a company has too many liquid assets, it is not profiting from these resources by investing them.
Market makers, together with speculators, are the major contributors to assets’ liquidity. These are companies and individuals seeking to make profit from the rising and falling prices of particular assets. They dispose of and provide capital which increases liquidity.
Central banks are key players when it comes to increasing the liquidity of money. They implement various monetary policies to exert control over the monetary supply of the country. Central banks buy and sell government securities and other financial instruments and use interest and exchange rates to implement monetary policy.
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