This factor calculates the ratio of the net increase in liquid operating assets to average total assets during the reporting period. Liquid operating assets mainly include accounts receivable, notes receivable, prepayments, other receivables, inventories, and deferred expenses, which reflect assets that are directly generated from the daily business activities of the company and can be quickly converted into cash. The changes in liquid operating assets can reflect the strategic choices of the company in the process of business expansion or contraction. However, it should be noted that accounts receivable and inventory in liquid operating assets are subjective in accounting treatment and are easily affected by earnings management. Therefore, the reliability of this factor will be affected to a certain extent.

Empirical studies have shown that there is a negative correlation between the growth of liquid operating assets and the future profitability and stock returns of the company, which may be caused by overexpansion or aggressive accounting treatment. Therefore, investors should analyze carefully when applying this factor, and make a comprehensive judgment based on other financial data and industry characteristics to avoid potential mispricing risks.