1 Liquid Market - the degree to which market participants are willing to buy and sell at every price level.

Liquid markets are characterized a high level of trading actively preformed by a diverse group of traders (hedgers, corporations, governments, speculators).

Liquid markets are usually described as safer, since investors are more certain that they are able to get into or out of a trade in any market condition.

2 Liquid Asset - the degree to which an asset is able to be converted into quickly into cash. The classic examples of liquid assets are Money Market Accounts and Certificate of Deposits or in equities, Blue Chip stocks.