Marketable Securities: Liquidity and Stability | CFA® Level 1 Test Prep

Liquidity and Stability of Marketable Securities

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Question

Which of the following marketable securities would provide the greatest liquidity and stability?

Answers

Explanations

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A. B. C. D. E.

E

U.S. treasury bills would be the most liquid because the maximum maturity is 182 days (although most treasury bills purchased by firm's have a shorter maturity).

In addition, the value of treasury bills would fluctuate less than the value of the common stock of another firm or long-term corporate bonds.