What are the motives for Corporate Holding Cash?
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A step-by-step guide covering Python, SQL, analytics, and finance applications.
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The three key motives for holding cash are:
1. The transaction motive – Cash is required to conduct ordinary business activities
2. The precautionary motive: Cash is required meet any contingencies in future. It is like a cushion or buffer to support unexpected emergency.
3. The speculative motive: Cash may be required to take advantage of opportunities.