Taking a loan or borrowing money from friends to purchase a car is a good example of investing in a depreciating asset. If it is, then consider buying a second-hand car or a small car. Such investments never add any value but only take away a huge chunk of your money.

Inventory item – is a separate product which can be specified in stock. If your company sells stock items, you can track inventory. An inventory item is a product that is purchased for resale and is tracked in Stock and on the Balance Sheet. Quantity on Hand – the available stock on hand or in all warehouses.

Common examples of financial assets are:

• Cash and cash equivalents, like a checking or savings account.
• Bonds.
• Stocks.
• Certificates of deposit.
• Mutual funds, also known as money market funds.
• Retirement accounts, like 401(k)s and IRAs.

The assets that can be converted into cash within a short period (i.e. 1 year or less) are known as Current assets. Current assets include cash, cash equivalents, accounts receivable, stock inventory, marketable securities, pre-paid liabilities, and other liquid assets.

1. Cash, bank accounts, and CDs: Cash is the most liquid asset there is.

Long-term assets, sometimes called capital assets, are more difficult to turn into cash. These assets include equipment, furniture, and fixtures, then land and buildings. Note that land and buildings take the longest to be converted into cash, so they are listed last.

Gold as an investment and the market liquidity is a market’s ability to purchase or sell an asset at stable prices. High liquidity means that a high number of parties are willing to take the other side of the trade. Gold, like cash, shines as a very liquid asset.

Top 12 Best Short Term Investments That Limit Your Risk

• Blockfi Savings Account.
• Bank Savings Accounts.
• Money Market Accounts.
• Alternative Investments.
• Certificate of Deposits (CD)
• Roth IRA.
• Checking Accounts.
• Short-Term Bond Funds and ETFs.