Glossary

Illiquid Market
An illiquid market is a market that is difficult to sell assets in due to a lack of interested buyers, available assets, or because the market itself is not viable as a financial asset. Assets in these markets are often difficult to convert to cash without losing a significant portion of its value because of their large bid-ask spreads. Illiquid markets can hold high-value assets, but if no willing buyers are found, sellers may be forced to lower their price or hold on to their assets longer than preferred.
Examples of illiquid assets
Illiquid assets include a wide range of markets. Generally, any asset that is traded infrequently with discrepancies between bid and ask prices are illiquid assets. Examples of illiquid assets include penny stocks, real estate, or collectibles like artworks and antiques.

Search the Academy

Look up the meaning of hundreds of trading terms in our comprehensive glossary.

A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z