liquidity ratio

liquidity ratio definition - finance
A measure of how quickly a company can liquidate its securities and cover its short-term liabilities. It is a measure of a companyÂ’s financial strength. To calculate the liquidity ratio, divide the total value of all cash and marketable securities by current liabilities. Also called cash ratio.

Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.

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