Why are marketable securities important for a business?

Marketable securities are important for a business primarily because they provide quick cash availability. These securities, which often include stocks and bonds that can be readily sold in financial markets, serve as a way for companies to maintain liquidity. When a business holds marketable securities, it can quickly convert them into cash to meet immediate operational needs, such as paying suppliers, settling debts, or responding to unforeseen expenses without needing to liquidate long-term assets or disrupt ongoing projects.

Having this type of financial asset enables a company to be more agile in its financial decisions and maintain stability during times of economic uncertainty or cash flow irregularities. This quick access to cash can be critical for ensuring that a business can operate smoothly and strategically capitalize on opportunities as they arise without delay.