Market Sentiment

Flight to Liquidity

Definition

What is Flight to Liquidity?

A shift toward assets that can be sold quickly and reliably.

Example in practice

Investors sell thinly traded securities and hold cash during a crisis.

Keep learning

A market environment in which investors favour higher-risk assets.

A market environment in which investors move toward perceived safety and liquidity.

An asset expected to retain or gain value during periods of market stress, though no asset is safe in all circumstances.

A contract whose value depends on an underlying asset, rate, index, or event.

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