Gold is a substance with high market liquidity, as it may be sold quickly without having to reduce the price. In business, economics or investment, market liquidity is a market's feature whereby an individual or firm can quickly purchase or sell an asset without causing a drastic change in the asset's price. Liquidity involves the trade-off between the price at which an asset can be sold, and how quickly it can be sold. In a liquid market, the trade-off is mild: one can sell quickly without having to accept a significantly lower price. In a relatively illiquid market, an asset must be discounted in order to sell quickly.[1][2] Money, or cash, is the most liquid asset, because it can be "sold" for goods and services instantly with no loss of value. There is no wait for a suitable buyer of the cash. There is no trade-off between speed and value. It can be used immediately to perform economic actions like buying, selling, or paying debt, meeting immediate wants and needs.[1] In an alternative definition, liquidity can mean the amount of cash and cash equivalents.[3] If a business has moderate liquidity, it has a moderate amount of very liquid assets. If a business has sufficient liquidity, it has a sufficient amount of very liquid assets and the ability to meet its payment obligations. An act of exchanging a less liquid asset for a more liquid asset is called liquidation. Often liquidation means selling the less liquid asset for cash. An asset's liquidity can vary due to circumstances. An asset can be easier to sell in one location than another, or at different times of the year. The liquidity of a product can be measured as how often it is bought and sold. Liquidity is defined formally in many accounting regimes and has in recent years been more strictly defined. For instance, the US Federal Reserve applied quantitative liquidity requirements based on Basel III liquidity rules in fiscal 2012.[4][5] Bank directors are required to know of, and approve, major liquidity risks personally. Other rules require diversifying counterparty risk and portfolio stress testing against extreme scenarios, which tend to identify unusual market liquidity conditions and avoid investments that are particularly vulnerable to sudden liquidity shifts.