Sir, The way to reconcile Nicola Ralston’s and Hugh Stewart’s differing understandings of liquidity (Letters, June 16 and 20) is to posit a two-way price for each. The one might be 99 1/4-100 1/4 per cent and the other 40-120 per cent. This latter apparently huge spread or turn recognises how low Mr Stewart would make his offer to buy and is his theoretical recompense for his costs for the years it might take before he is able to sell it on.

Relevant here is Venezuela’s 2022 bond which once upon a time may have traded close to 100 but which, as you note in “ China recasts loans deal with Venezuela” (June 20) FT, has collapsed in price to the point where it currently yields 33 per cent. A better general appreciation of the concept of liquidity might point the way to the needed reduction in volatility in markets.

Perry Aldred

Walton-on-Thames, Surrey, UK

Copyright The Financial Times Limited 2018. All rights reserved.