Speculative motive
A desire to hold cash for the purpose of being in a position to exploit any attractive investment opportunity requiring a cash expenditure that might arise. |
Similar financial terms
Speculative grade bondBond rated Ba or lower by Moody's, or BB or lower by S&P, or an unrated bond.
Speculative demand (for money)
The need for cash to take advantage of investment opportunities that may arise.
Speculative Bubble
A rapid, but usually short-lived, run-up in prices caused by excessive buying which is unrelated to any of the basic, underlying factors affecting the supply or demand for the commodity. Speculative bubbles are usually associated with a "bandwagon" effect in which speculators rush to buy the commodity (in the case of futures, "to take positions") before the price trend ends, and an even greater rush to sell the commodity (unwind positions) when prices reverse.
Transactions motive
A desire to hold cash for the purpose of conducting cash based transactions.
Precautionary motive
A desire to hold cash in order to be able to deal effectively with unexpected events that require cash outlay.
