How to determine the liquidity of assets. Functions of money. cash liquidity. What is project liquidity

The most important property of money is its high liquidity. Liquidity is understood as the ability of any property, i.e. assets, directly serve as a means of payment or become a means of payment.

In principle, many types of assets have the property of liquidity. For example, gold bars have high liquidity, despite the fact that gold has ceased to play the role of money. Gold can be converted relatively easily into the currency of any country that can serve as a means of payment. At the same time, in order to convert gold into cash or non-cash money, a certain time is required. This operation is also associated with small costs associated with paying for the services of agents involved in the purchase and sale of gold.

An obsolete TV, on the contrary, has very low liquidity, since it is sold, i.e. converting it into a means of payment is almost impossible. It will take a long time to sell such a TV and pay large commissions.

Cash, banknotes, directly serve as a means of payment, so they have absolute liquidity. Very high, almost absolute liquidity have demand deposits, giving the right to issue checks. Somewhat lower, but also very high, is the level of liquidity of fixed-term and savings deposits and government bonds.

The liquidity factor significantly affects the decisions made by firms and households. Other things being equal, firms and households prefer perfectly liquid cash and almost completely liquid demand deposits. But this type of money has a significant drawback: cash does not generate income, and the interest paid to depositors on demand deposits is low and, as a rule, only compensates for the general increase in prices. Therefore, the real income on these deposits is zero.

The liquidity of time and savings deposits is slightly lower than the liquidity of cash. But these deposits bring real income in the form of interest paid on these deposits.

The liquidity of government bonds and government short-term obligations (GKOs) is still somewhat lower. They cannot directly serve as money, but they are easily sold at a price that corresponds to their face value. According to the liquidity criterion, modern credit money is grouped into several monetary aggregates. The monetary aggregate is an indicator of the money supply, determined by the level of its liquidity.

There are the following monetary aggregates:

M0 - cash; Ml - cash + demand deposits; M2 - cash + demand deposits + savings deposits + small term deposits; M3 - cash + demand deposits + savings deposits + small term deposits + large term deposits; L - the total money supply expressed by the M3 aggregate + savings bonds + short-term government obligations (bills) + commercial bills.

Thus, the money supply circulating in the economies of countries with a developed market system has a rather complex structure. This is shown in fig. 9-3.

Consideration of the structure of the money supply shows that the main role in the functioning of a developed market system is played not by cash, but by non-cash money. But non-cash money cannot exist and circulate without banks. Moreover, cash, represented by banknotes, owes its origin and existence to banks. Therefore, in order to understand how the market system works, we need to understand what banks are.

The more liquid it is. For a product, liquidity will correspond to the speed of its sale at a nominal price, without additional discounts.

Absolute liquidity

Absolute liquidity ratio(eng. Cash ratio) - a financial ratio equal to the ratio of cash and short-term financial investments to short-term liabilities (current liabilities). The data source is the company's balance sheet in the same way as for current liquidity, but only cash and cash equivalents are taken into account in the assets: (1250+1240) / (1500-1530-1540).

Kal \u003d A1 / (P1 + P2) Cal = (Cash + short-term financial investments) / Current liabilities Kal \u003d (Cash + short-term financial investments) / (Short-term liabilities - Deferred income - Reserves for future expenses)

It is believed that the normal value of the coefficient should be at least 0.2, that is, 20% of urgent obligations can potentially be paid every day. It shows what part of the short-term debt the company can repay in the near future.

Market liquidity

Liquidity of securities

The liquidity of the stock market is usually assessed by the number of transactions made (volume tradings) and the size of the spread - the difference between the maximum prices of buy orders and the minimum prices of sell orders (they can be seen in the glass trading terminal). The more deals and the smaller the difference, the greater the liquidity.

There are two main principles for making transactions:

• quotation- placing own orders for the purchase or sale, indicating the desired price.
• market- placing orders for instant execution at current bid or offer prices (satisfaction of quotation orders with the best current price).

Quoted bids form instant liquidity market - the author indicates the volume, the desired price and waits for the satisfaction of the application, allowing other bidders to buy (or sell) a certain amount of the asset at any time at the price specified by the author of the application. The more quotation orders placed for a traded asset, the higher its instant liquidity.

Market Orders form trading liquidity market - the author indicates the volume, the price is formed automatically based on the best prices from current quotation orders, which allows the authors of quotation orders to buy (or sell) a certain amount of an asset. The more market orders per instrument, the higher its trading liquidity.

Many do not even know what liquidity is. This word, which comes from the Latin “liquidus” (“fluid”, “liquid”), is most often understood as the mobility of assets, which ensures the ability of their owner to pay obligations without interruption and on time.

To date, there are several concepts related to each other: liquidity of assets, property, balance sheet, enterprise, market, money, stock market. The liquidity of the balance sheet is the basis of the liquidity of the enterprise, since it is more important for it to have cash than profit. Lack of money often leads to a deplorable financial condition.

It is noteworthy that the liquidity of the balance sheet is a more capacious concept than the liquidity of property. This term is applied to enterprises, banks, stock markets, various organizations, securities. The ratio of the amount of cash and assets sold in the shortest possible time and the amount of current liabilities (liabilities) determine the degree of liquidity. The concept of "liquid" refers to any asset that is quickly convertible into money. This category includes:

• stocks and bonds of large joint-stock companies;
• state securities;
• term bills of well-known companies;
• undisputed receivables;
• easily realizable values;
• precious metals.

The larger the share of such assets, the higher the liquidity.

Types of assets

Liquidity is the ability of values ​​(assets) to be sold as soon as possible at a near-market price. Every organization has the following types of assets:

• illiquid, convertible into cash at book value only after a long period of time and those that are never realized. They include various structures; equipment and machines that are prepared for installation; intangible assets; Construction in progress; long-term financial investments; overdue receivables; stocks of products that have not found a market;
• low-liquidity (slowly sold), sold at a cost close to the market for a significant period of time. These include some fixed assets, certain types of stocks, long-term debt of debtors;
• liquid, sold relatively quickly. They include short-term receivables; some stocks; company securities;
• highly liquid, which are sold very quickly. These include money in accounts, at the cash desk; short-term investments; bills; government securities.

Liquidity of enterprises

The liquidity of an enterprise is the ability to pay short-term (current) accounts payable by selling current assets. Financial analysis evaluates its solvency. Its main instrument is financial indicators, called liquidity ratios. They are calculated according to the financial statements. These indicators characterize the nominal ability of the enterprise to repay the current debt with current assets. Often their calculation is accompanied by a balance sheet modification, which is carried out to obtain an adequate assessment of the liquidity of different types of assets.

All values ​​differ in different levels of liquidity. It is because of this that some components of the balance sheet of the enterprise, when it is modified, are taken out of the limits of assets. When determining liquidity ratios, they are not taken into account. There are 4 groups of assets:

• the most liquid (A1);
• implemented quickly (A2);
• implemented slowly (A3);
• implemented with difficulty (A4).

Obligations (liabilities) are divided into 4 groups:

• the most urgent (P1);
• short-term (P2);
• long-term (P3);
• permanent (P4).

An enterprise can be called liquid only when the following conditions are met: A1> P1, A2> P2, A3> P3, A4<П4 (обладает регулярным характером). При выполнении 3 первых неравенств, последнее выполняется обязательно.

Enterprise liquidity indicators

When assessing the degree of solvency of an enterprise, the following coefficients are determined:

1. Ktl (current liquidity), characterizing its ability to repay current accounts payable with current assets. It is also referred to as the debt coverage ratio. It characterizes the solvency, taking into account the expected receipts of receivables. Simply put: if current assets > current liabilities (liabilities), then the company is operating successfully. The current liquidity ratio is calculated as follows:

Ktl \u003d (OA) / KO,

where OA - current assets, KO - short-term liabilities;

Ktl \u003d (A1 + A2 + A3) / (P1 + P2).

The higher the Ktl indicator, the higher the solvency. Different enterprises may have different Ktl. An indicator that is in the range of 1.5-2.5 is considered normal.

2. Kbl (quick liquidity), reflecting the company's ability to pay off short-term liabilities in the event of problems with the sale of products. The quick liquidity ratio is calculated only for certain types of assets. It is equal to the ratio of liquid current assets (TA) and liabilities (TO):

Kbl \u003d (TA–Z) / TO,

where З - reserves;

Kbl \u003d (A1 + A2) / (P1 + P2).

Its optimal value is considered to be that which fits into the range of 0.7-1.0. The growth of Kbl associated with the increase in receivables is not a positive indicator of economic activity.

3. Kal (absolute liquidity), which establishes how much of the debt can be quickly repaid. Estimated data is taken from form No. 1, but only cash and assets equivalent to them are included in the assets of the enterprise. Cal is determined by the following formulas:

Kal \u003d (DS + KV) / (KP - DBP - RBR),

where DS - cash; KP - short-term liabilities; RBR - reserves for future expenses; KV - capital investments; DBP - future income;

Kal \u003d A1 / (P1 + P2).

The toughest of the solvency indicators is the absolute liquidity ratio. Its normal value cannot be less than 0.2, which means that the company will be able to pay up to 20% of current liabilities every day.

Market liquidity

This concept is understood as the reaction of the market to fluctuations in supply / demand by attracting buyers and sellers. In order to recognize it as liquid, there must be regular purchase and sale transactions on it in sufficient quantities. The difference in the price of demand (bids for purchase) and the price of offer (sale) should be small. In a highly liquid market, any one transaction does not have a significant impact on the cost of goods. In other words: market liquidity is its ability to absorb fluctuations in supply / demand without significant fluctuations in commodity prices.

The main property of money is its liquidity. It represents the possibility of their use as a means of payment in the acquisition of goods and other benefits. This indicator indicates their ability not to lose their nominal value. Money, more than other assets, is protected from fluctuations in its value. As a rule, money has absolute liquidity within a certain economic system, although it is not always exchanged for goods in a short time. Perfect monetary liquidity is possible in a stable monetary system.

Liquidity of securities

This term, used in relation to the stock market, means the ability to buy/sell any exchange instrument (currency pair, shares, futures) in the shortest possible time without losing their price. It means their comparative quantity, which is exchanged for money in a short period of time without a serious change in their market value. Low liquidity is proof that securities will not be sold/purchased within a certain period of time without significant financial losses.

High liquidity shows that securities can be quickly sold / bought without a serious impact of such an operation on the existing market price level. This type of liquidity is estimated by the number of transactions (trading volume). The spread (the difference between the highest bid prices and the lowest bid prices) is also taken into account. At the same time, the greater the number of transactions and the smaller the spread, the higher the liquidity of securities.

The liquidity of money - the ability at any moment or within a certain period of time to turn money into any kind of goods or services that the owner of money needs, is their natural property as a means of circulation and means of payment. Liquidity determines the possibility of monetary circulation, i.e. the movement of money in society and the economy as a means of paying private and public debts. This includes not only the circulation of commodities, but also the movement of labor and capital. Unfortunately, monetarist theories narrow the problems of money circulation to the maintenance of commodity circulation. With this approach, the central problem of monetary regulation becomes the question of the amount of money needed for circulation.

The economic tradition, starting from W. Petty and K. Marx and ending with modern economists, adheres to the quantity theory of money required for circulation. With all the discrepancies in the theoretical explanation of the ratios and content of individual quantities, the content of this theory is the same, changing mainly depending on changes in the monetary material - from precious metals to credit money. For the first time, the regular amount of money in circulation in the form of a simple formula was defined by Karl Marx as follows:

"... for the process of access for a given period of time:

The number of turnovers of any working capital, including goods in cash, is determined by the formula
n = c / S, (2.2)
where n - the number of turnovers of working capital for a certain period of time; c - the volume of sales of goods (equal to the sum of the prices of goods); S - the average amount of working capital.
We represent the formula in the form
M = s / n, (2.3)
where M is the mass of money functioning as a medium of circulation.

From a comparison of the above formulas, we obtain that M = c / n = S, i.e. "the mass of money in circulation" is equivalent to the average for the period of the balance of working capital serving a given volume of sales of goods.

However, this position is not entirely true. Let us assume that we consider the working capital of the country, serving the general commodity turnover. It is obvious that the working capital cannot be all present in the form of money at the same time. Part of this capital must be presented in the form of goods at the stage of production, preparation of goods for shipment, in transit, in the trade network, etc.

Reasoning about the speed of money turnover based on the equality C=M or M=C in each individual commodity transaction does not stand up to criticism from the standpoint of reality, because the money supply is primarily a part of the country's working capital, and the needs for the sale of goods in money are determined by the size and speed of the sale of public goods. product, as well as generally accepted forms of settlements and payments.

When analyzing this issue, it is extremely important to note that in reality, the funds in the national economic circulation fall into three streams, which at times merge again:

The first flow is the funds used to purchase goods by some participants in the economic process from others. This is money flowing from buyers to sellers - suppliers of raw materials, materials, equipment, etc. In other words, the cash flow from the sale of the final product to enterprises that extract raw materials. Its value is indeed determined depending on the prices and volumes of purchased products.

At the same time, at each stage of the process of production and sale of products, part of the money leaves the process of commodity circulation and forms the cash income of the population. The latter have their own cycle and patterns of circulation. The main feature of the movement of money in this flow is that the timing and frequency of receipt of income do not coincide with the speed of spending money on the purchase of goods and services. In fact, it is necessary to distinguish not one, but at least two rates of money turnover:

• when paying income;
• when spending income on the purchase of goods, i.e. as a means of servicing commodity circulation.

In the third stream, part of the money is saved by participants in economic processes and then invested in the further development of production in the form of capital.

Money is the universal equivalent of value. Money- a special commodity that performs the role of a universal equivalent in the exchange of goods. Money is an absolutely liquid medium of exchange. Liquidity- the ability of any financial asset to turn into cash. The degree of liquidity of assets is determined by how quickly and at what cost (compared to their monetary value) these assets can be sold. Absolute liquidity government-issued cash. highly liquid Treasury bills, short-term government securities, are considered. This is because the market prices of these securities change only slightly from day to day, and also because they can be easily sold on the financial markets (because they are highly reliable), and the transaction costs will be very low. Intermediate or medium level of liquidity equities and long-term bonds issued by private corporations are possessed, since the prices of these assets change much more over time and the fees charged for transactions with such securities are much higher. Illiquid real estate (houses, industrial buildings), as the market price for it is very volatile, it is difficult to predict before the transaction. The costs of such transactions can be very high.

The essence of money is manifested in their functions: measures of value, means of circulation, means of payment, means of accumulation, world money. Money as a measure of value mean that they measure the value and price of goods. Money measures the value of commodities, i.e., the commodity is equated with a certain amount of money, which gives a quantitative expression of the value of the commodity. Price - the value of a thing, expressed in money. The state uses a certain monetary unit (ruble, dollar) as a scale for measuring value. Also, weight is measured using units of weight (grams, kilograms, etc.), the cost of goods has a monetary value. Because of this, we can measure the value of economic goods.

Money as a medium of exchange involved in the sale and purchase of goods and services. In this case, money acts as a fleeting intermediary. The use of money as a medium of exchange reduces the costs of circulation by reducing the effort and time to complete the purchase and sale. This function of money explains the appearance in circulation of defective coins (coins, the content of gold and silver in which is less than the face value, i.e., the weight indicated on the coin), as well as paper money.

Money as a means of payment act in the payment of wages, taxes, insurance payments, the sale of goods on credit, and in many other cases when the movement of money is not mediated by the movement of goods. If a commodity is sold on credit, then the medium of circulation is not the money itself, but debt obligations expressed in money. As the industrial society develops, the means of payment increasingly replaces the medium of exchange, the sale and purchase on credit become the most common. The fulfillment of this function by money led to the emergence of credit money: bills of exchange and bank notes.

Money as a store of value do not participate in turnover and act as a financial asset. Money is a convenient form of storing wealth. Here, money acts as a special asset that is retained after the sale of goods and provides its owner with purchasing power in the future. True, keeping money, unlike owning stocks, bonds, savings accounts, does not bring additional income. However, the advantage of money is that it can immediately be used as a medium of exchange or means of payment.

Function world money is performed on the world market when servicing the movement of goods and services, capital and labor. World money is the same as national money, only at the international level. The currencies of the leading countries (dollar, pound sterling), as well as money created as a result of collective agreements (euro) act as world money.