So, as a sign of repentance, let me try attempt to clarify these different notions and to make the firm resolution to stick to them, at least until the end of this speech. In the context of the properties of an individual financial instrument, the notion of liquidity typically refers to the ability of trading such instrument (i.e.
purchasing or selling it) without unduly affecting its price. In particular, an asset is described as liquid, thereby entailing limited liquidity risk, if it is reasonable to assume that it can be easily sold without incurring a loss of value. The notion can also be used to characterise an entire market, also to reflect co-movement in liquidity across assets.