An investment that faces high marketability risk also has high liquidity risk.

Question

Quizplus · Accepted Answer

Marketability risk refers to the risk that an investment cannot be sold quickly or easily without incurring a significant loss in value. Liquidity risk refers to the risk that an investor may not be able to sell an investment when needed, resulting in a loss or the need for a significant discount to be offered to attract a buyer. Therefore, an investment that faces high marketability risk is also likely to face high liquidity risk.

An Investment That Faces High Marketability Risk Also Has High