June 20, 2024


Phenomenal Business

How to raise financial liquidity for stock markets

Volatile stock markets are an option trader's dream — here's how to start -  MarketWatch

If you want to make headway in the stock market, you must ensure that you keep your liquidity in a good position. If you cannot pay your bills as and when due and stay afloat, you may be heading for bankruptcy. Here are tips for raising your liquidity:

Reduce overhead costs and get rid of unproductive assets

Evaluate your overhead costs and look for ways to reduce them without negatively impacting your finances. The lower your overhead, the more your productivity and profitability. Expenses such as rent, indirect labor, advertising, etc. are part of your overhead costs. Also, if you have assets that are not productive, you should get rid of them. The only function of an asset is to generate revenue for you, not for storage or decorative purposes. Spend your money only on assets that bring you income such as buildings, etc.

Diversify your funding sources

You should have more than one funding sources. It is better to have a portfolio of investments than to have just a single investment. The more you diversify, the more you reduce your chances of suffering deathblows when a funding source does not work out. You can consider share programs, venture capitalist funds, grants, etc. You should have a cash reserve and be prepared for negative events that may happen in the future. One of the funding sources you can consider is getting loans from companies such as LoanMart and Loan Pioneer.

Restructure your debts

If you have a significant amount of debt, it is required that you service it regularly, maybe monthly. This may be weighing you down financially. One way you can improve your solvency is to work with your creditors and modify the loan terms so that you can have a good cash flow at the end of the month while also paying your debt. Try to extend the periods at which you pay your debt. Not all creditors will accept this but some are open to rescheduling the existing payment plans.

Get rid of unneeded expenses

When you do a proper analysis of your personal or business finance, you will realize that regular small expenses aggregate to become huge at the end of the day. Some small expenses are essential, while some are not. For instance, you can start getting some things you use regularly in bulk at discount stores instead of buying it unit per unit. If you have employees, you can tell them to provide their coffee instead of putting the cost on the office.

Properly utilize any idle funds

If you have any funds you have no urgent need for at the moment, instead of wasting its potentials of yielding more for you or eventually spending it frivolously, you can invest it in liquid assets. This type of investment will help you increase your liquidity. You earn interest on deposits while still retaining your access to your money. You can also sweep your accounts, you can check with your bank on the various options you can do with idle funds.