Where liquidity risk is referred to, it appears to have two similar meanings:
Is it necessary to regard the term 'liquidity risk' as having two separate possible meanings, or is there a concise definition that covers both?
- the risk that an investor will be unable to buy/sell a security at its theoretical market price; and
- the risk of experiencing cashflow problems.
Is it necessary to regard the term 'liquidity risk' as having two separate possible meanings, or is there a concise definition that covers both?