Which of the following statements about the liquidity (transactional and distribution) needs of an investor and the resulting investment activity is incorrect? Liquidity needs of an investor are positively correlated with portfolio's expected returns - higher liquidity needs is catered by investing in assets with higher expected returns. Investment grade short term government bonds can provide high level of liquidity in all market conditions. Investors with higher liquidity needs should ensure that they invest in higher yielding investments such as Large capitalized equities Investors should sell investments that are considered to be at, or above, their fair value to generate liquidity Investors with lower liquidity needs should consider investing in smaller capitalized equities