Sawyer Capital ManagementLiquidity Key Price Factor – Sawyer Capital Management https://www.sawcap.com Evolutionize Web Site Tue, 14 Nov 2017 19:30:19 +0000 en-US hourly 1 https://wordpress.org/?v=5.1.22 Liquidity Key Price Factor https://www.sawcap.com/2016/04/04/liquidity-key-price-factor/ https://www.sawcap.com/2016/04/04/liquidity-key-price-factor/#respond Mon, 04 Apr 2016 09:00:31 +0000 http://evolvemypractice.com/?p=2696 Liquidity—the ability to buy and sell significant quantities of a given asset, quickly, at low cost and without a major price concession—is valuable to investors. Therefore, they demand a premium as compensation for the greater risks and costs of investing in less liquid securities. For example, liquidity risk partly explains the equity-risk premium. The average...

The post Liquidity Key Price Factor appeared first on Sawyer Capital Management.

]]> Liquidity—the ability to buy and sell significant quantities of a given asset, quickly, at low cost and without a major price concession—is valuable to investors. Therefore, they demand a premium as compensation for the greater risks and costs of investing in less liquid securities.

For example, liquidity risk partly explains the equity-risk premium. The average transaction costs on stock trades are far larger than they are on Treasury bills, which can be traded in large blocks of tens of millions of dollars in a single transaction without affecting their price.

Read the rest of the article on ETF.com.

The post Liquidity Key Price Factor appeared first on Sawyer Capital Management.

]]> https://www.sawcap.com/2016/04/04/liquidity-key-price-factor/feed/ 0