This is a problem with no solution, unless you want to ban
illiquid securities from hedge funds.
Not exact matches
We trade all fixed income assets, with a focus on more
illiquid situations,
from high yield, distressed and investment grade bonds and convertible bonds to public and private corporate
securities and leveraged loans.
Pluris» proprietary LiquiStat database includes valuation data
from recent sales of
illiquid assets: restricted stock, warrants, options, convertibles, auction rate
securities, structured products, bankruptcy claims, private company stock, and limited partner interests.
As a result, those that make markets, or buy and sell stocks tend to be more cautious in setting prices to buy and sell
illiquid securities because of the difficulty of trading, and the problem of moving the market away
from you with a large order.
As a result, those that make markets, or buy and sell stocks tend to be more cautious in setting prices to buy and sell
illiquid securities because of the difficulty of trading, and the problem of moving the market away
from you with a large order.
For instance, there are companies that specialize in securitizing the mortgages (a way of turning an
illiquid asset into an investable
security), as well as groups that focus on packaging cash
from hundreds of investors and turning it into developer loans (also known as syndicated mortgages).
Certain holders would be forced to sell as institutional mandates would preclude them
from holding
illiquid securities such as the participating interests in the FUR liquidating trust.
Dr. Wade Pfau's new book, Reverse Mortgages: How to use Reverse Mortgages to Secure Your Retirement explains how, when used correctly, reverse mortgages can provide an added layer of
security for retirees and allow them to enjoy retirement more by gaining liquidity
from an
illiquid asset.
Liquidity risk exists when particular investments of the Fund would be difficult to purchase or sell, possibly preventing the Fund
from selling such
illiquid securities at an advantageous time or price, or possibly requiring the Fund to dispose of other investments at unfavorable times or prices in order to satisfy its obligations.
For an investor willing to hold a
security until maturity interest rate and liquidity risk are often a secondary concern, but a risk - adverse investor needs to realize that having the ability to exit a position quickly (same day) can be worth a lot more than the additional gain you could receive
from an
illiquid investment.
In the case of
illiquid or extremely volatile
securities, placing a market order may result in a fill price that significantly differs
from $ 175.
A Fund might be unable to dispose of
illiquid securities promptly or at reasonable prices and might thereby experience difficulty in satisfying redemption requests
from shareholders.
Restricted or
illiquid securities, such as private placements or non-traded
securities are valued via inputs
from the adviser valuation based upon the current bid for the
security from two or more independent dealers or other parties reasonably familiar with the facts and circumstances of the
security (who should take into consideration all relevant factors as may be appropriate under the circumstances).
These are specialist funds, kept separate
from their parent company's balance sheet, that invest in
illiquid assets, such as
securities backed by subprime mortgages.
«The Continued Risk of Troubled Assets», the latest report
from the Congressional Oversight Panel (COP), points out the ongoing risks that commercial and residential mortgage - backed
securities (CMBS and RMBS, respectively), along with other
illiquid troubled assets, pose for financial institutions and the financial system.