Sat, Oct 25, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
A SQUARE

Liquid asset led premiums vs. Illiquidity return led premiums

Wednesday, March 31, 2010
We simply define liquidity as the ability to take one’s money out of an investment instantaneously without a market impact. That would be the idea of perfect liquidity. So one is able to take their money out of an investment without losing value in.

A SQUARE :: 31Mar10 Liquid asset led premiums vs. Illiquidity return led premiums
Category Risk Management
Author Sona Blessing
- There is a third dimension to liquidity and illiquidity. It's not just the risk and the return, but the certainty of the return.


- There is a potential downside to too much liquidity :


Ucits funds have weekly liquidity, for instance. Well, if I am an investor that stays in the hedge fund, I am not benefiting by other investors coming and going.


- Sorry to say, but there is no such thing as perfect liquidity. There is a spectrum of liquidity
Download this research The many benefits of an A SQUARE subscription Recommend to a friend

<< A SQUARE archive sorted by date    << A SQUARE archive sorted by category

 Article link
More research related to Risk Management

[07Dec08] [Risk] Conservation of risk as a concept
Adoption of a conservation of risk framework greatly increases investor/manager awareness of the trade-offs in risk and uncertainty that are at the heart of investing

Download

Banner

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Commodities - Oil wreaking havoc on small-cap energy stocks sliding 36%[more]

    From Bloomberg.com: Owning almost anything in the U.S. stock market has been a losing proposition since September. Owning smaller energy companies has been a catastrophe. Hercules Offshore Inc. and Resolute Energy Corp. are among 19 oil-and-gas equities in the Russell 2000 Index that lost more than

  2. Investing - Hedge funds favor equity long/short, Strategic bond managers hedge against further high yield sell-off[more]

    Hedge funds favor equity long/short From Securitieslendingtimes.com: Equity long/short strategies will generate good returns for hedge funds in the future, according to a panel at this year’s Risk Management Association Conference on Securities Lending in Naples, Florida. Panellists Sand

  3. Legal - Ex-hedge fund analyst weeps as judge hands down 5 year sentence, Former Columbus investment manager Steven P. Moore indicted on theft charges, SEBI confirms ban for Hong Kong hedge fund, SEC announces enforcement action against compliance officer[more]

    Ex-hedge fund analyst weeps as judge hands down 5 year sentence From Hereisthecity.com: An ex-hedge fund analyst was sentenced to 5 years in prison for his role in insider-trading scheme. The New York Post reports that former hedge fund analyst Matthew Teeple was sentenced Thursday to fiv

  4. Goldman in talks to acquire IndexIQ[more]

    From Bloomberg.com: Can Goldman Sachs put ETF investors on a liquid diet? Goldman is in talks to acquire IndexIQ, Reuters has reported. Index IQ is a small exchange-traded-fund firm known mostly for products that replicate hedge fund strategies, called "liquid alternative" ETFs. While IndexIQ has 11

  5. Other Voices: CALPERS dilemma should be a warning to hedge funds wanting institutional investors[more]

    From Ian Hamilton, founder of IDS Group. A quick comment on the CALPERS’ disinvestment from the hedge fund market and the jitters it is causing. Pension Funds should not be sheep and follow CALPERS’ decision as the issues that CALPERS has with hedge fund investments are in many ways unique t