Sentences with phrase «illiquidity risk»
"Illiquidity risk" is a phrase used to describe the possibility or danger that an asset or investment cannot be easily converted into cash or sold quickly without incurring significant losses. In simple terms, it means you may have difficulty getting your money back quickly when you need it. Full definition
Spotify's valuation when it lists - expected to be within 90 days after filing — is forecast to be a few billion dollars higher than current trades, as illiquidity risk tends to depress the value ahead of listing, the sources said.
businessinsider.com
If this is representative of the endowment model, let me then say that the endowment model accepts illiquidity risk more than most strategies do.
In fact, opportunity risk may just be an extreme case of illiquidity risk (if the asset were fully liquid, you could switch to the better opportunity).
Higher yielding strategies have been rewarded in the past, but those yields result from greater interest rate or credit / illiquidity risk, or both.
The illiquidity risk premium is an excess return paid to investors for tying up capital.
If by «commitment» you mean locking in (as opposed to just a current choice) then I'd also suggest «illiquidity risk», i.e. can't get out of the poorer - performing investment to switch to the better one.
The bottom line: Generating higher potential returns over the longer term will likely involve accepting more volatility or illiquidity risk, or focusing on assets with higher return potential.
Higher yielding strategies have been rewarded in the past, but those yields result from greater interest rate or credit / illiquidity risk, or both.
For example, according to the Willis Towers Watson paper, it is expected that the illiquidity risk premium will be, on average, higher to compensate for investors under the new regime.
Pay us with a good yield, and I will eat the illiquidity risk on behalf of my client.