(1) The portion of a security's yield that is attributable to investors' desire to hold liquidity.(2) The difference or spread paid for liquidity.
An additional price paid for an asset on the basis of its greater liquidity or tradeability or, alternatively, an additional return required by an investor to compensate for lack of liquidity.
An extra component of yield or return required to compensate the investor for the possibility that an adequate retail market may not develop for a security.