> How does reduced liquidity equal lower share value? 1: Lower liquidity usually goes hand in hand with higher transaction costs, which means a bigger gap betw

> How does reduced liquidity equal lower share value? 1: Lower liquidity usually goes hand in hand with higher transaction costs, which means a bigger gap between how much the buyer pays and how much the seller walks away with. 2: Time value of money: Suppose some liquid asset can be exchanged for $X right now, and an otherwise equivalent illiquid asset can be exchanged for $X by, let's say, a month from now. $X today is more valuable than $X in a month, so no one is going to buy the illiquid asset today for $X if they could get the liquid one instead.