June 2011
Intermediate to advanced
236 pages
6h 25m
English
Liquidity Metrics
Below are key ratios and metrics to assess liquidity. This is not all inclusive, but will provide a basis from which to form an opinion. There are many other liquidity ratios commonly used. As mentioned before, cash and marketable securities are king. Access to capital is also part of the liquidity equation. A strong balance sheet will go a long way. Three metrics useful in measuring liquidity are:
1. Cash from operations to current liabilities (x)
2. Cash to short-term debt (x)
3. Short-term debt to long-term debt or short term debt to total debt (%)
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