FJP Investment Discusses - Liquid Assets meaning?

LONDON - July 6, 2013 - PRLog -- “FJP Investment Ltd pinpoints portfolio structuring with precision. Investors have learnt the importance of liquidity due to market crashes in the past and in general uncertainty within the markets of our portfolios” said Tom Roberts.

The level of liquid assets you should keep on hand largely depends upon your estimated monthly expenses. In all cases, you should be able to support yourself and family for at least a month or two; most financial planners agree that six months is ideal. It's important to remember that national emergencies are much less likely than personal emergencies such as car repairs, layoffs, washer and dryers falling apart, etc. Having cash on hand will allow you to stay the course with far fewer worries.

“Liquid assets are generally regarded in the same light as cash because their prices are relatively stable when they are sold on the open market” said Tom Roberts.

Liquid assets are assets that can be sold, traded, or disposed easily, usually in a time period less than 12 months. Examples include:

·         Cash

·         Inventories

·         Accounts Receivables

·         Cash equivalents

·         Short-Term Investments

·         Prepaid Expenses

“Banks have been building up capital to protect themselves against another downturn – Investors should be taking a similar stance” said Tom Roberts of FJP Investment Ltd.

According to Michael Saunders, UK economist at Citigroup, high-quality liquid assets of UK banks were just £10bn – 0.3% of the total – on the eve of the financial crisis in 2007. The latest data for May 2012 show that high quality liquid assets now stand at £356bn – almost 10% of the total and the highest percentage for at least 30 years.

“Generally speaking it is wise to have liquid assets due to life’s uncertainties. You may have some unexpected medical bills or perhaps a very special wedding to pay for. We specialise in the correct structure of investment portfolios” said Tom Roberts, FJP Investment’s spokesperson.