What is the definition of liquidity in finance?

In the context of financial markets, liquidity measures the ability of an asset or security to be quickly and easily converted into cash without significantly disturbing its market price.

The specific explanation of "without significant impact on its price" here is:

When a certain transaction causes minimal fluctuations in the market price, it indicates that the asset has good liquidity, that is, high liquidity.
On the contrary, if a transaction causes a significant change in the market price, it means that the asset is less liquid, that is, it has low liquidity.

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