How readily an asset can be turned into cash.

Examples:

Cash - The highest state of liquidity

Liquid - Can be turned into cash at immediately and at will for a pre-determined dollar amount.

Semi-Liquid - Can be turned into cash in less than one year, but the amount cannot always be determined.

Illiquid - Cannot be turned into cash within one year and the amount of cash received cannot easily be determined.

Unknown - The liquidity of this asset is not known.