The ease of salability of marketable securities refers to what?

Question

Finance

Answer 1

how liquid are the marketable securities that the firm has.

can you close a position quickly, or would you have to drop your sale price to get enough buyers.

Answer 2

Basically how easily can you sell your securities. This comes into play when you are dealing with large volumes. Suppose you hold a large share in a small company and start selling your shares.

If for example the daily volumes of the company on a stock exchange are around 50,000 shares and you start selling 5000 shares every ten minutes your selling will lead to the price of the stock going down and you will get lower price for each successive block of stock that you sell. This kind of security is not very liquid or salable. On the other hand even if you sell thousands of shares of say IBM nothing will happen to depress the price of it, and this is a good example of a liquid and salable stock.