Sun, Feb 25, 2018
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
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. Opalesque Exclusive: Global Sigma captures February's long-vol trade[more]

    Bailey McCann, Opalesque New York for New Managers: Florida-based Global Sigma rode February's volatility to new highs. The firm's AGSF strategy is up +2.8 percent through February 16 and +4.2 percent YTD a

  2. Art & Motion launches collectible car alternative investment vehicle[more]

    Komfie Manalo, Opalesque Asia: Luxembourg-based Art & Motion has launched a new investment vehicle dedicated to vintage cars and exceptional high-quality vehicles as this collectible market has grown exponentially the turn of the centu

  3. Investing - Hedge funds turn short on tech just as stock rally takes off, After biggest short, speculators slash bearish US bond bets as supply deluge looms[more]

    Hedge funds turn short on tech just as stock rally takes off From Newsmax.com: A key group of investors has just missed out on the biggest tech-stock rally since 2014. Hedge funds and other large speculators turned net short on Nasdaq 100 Index futures for the first time in 21 months, ac

  4. Low volatility funds fail to protect investors[more]

    From FT.com: A number of exchange traded funds (ETFs) designed to protect investors from sharp stock market gyrations lost more money than mainstream US stocks during a sell-off this month, underperforming in precisely the conditions in which they were meant to thrive. Low volatility ETFs, lau

  5. Legal - Hedge funds fight to save M&A arbitrage strategy, Fannie Mae and Freddie Mac ruling blow to hedge funds[more]

    Hedge funds fight to save M&A arbitrage strategy From FT.com: Hedge funds which use the US courts to wring higher prices for merger and acquisition deals are fighting to save the lucrative investment strategy, after a Delaware court ruling that threatens to shut it down. Verition Partner