Short Term Investment

Short Term Investment

Introduction

Holding excess cash in hand is improves the liquidity of the company but increase the opportunity cost and take away the revenue generation opportunity of the company. Cash like any other asset needs to be utilized at maximum iteration so that it can generate revenue for the company. Organizations often keep a huge amount reserved for meeting it short term obligations but that cash reserve remains idle for a longer period of time. The company usually invests that amount in available short term investment opportunities with the possibility of drawing back the amount to meet its immediate ...