Illiquid Asset

(redirected from Illiquid Investment)
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Related to Illiquid Investment: Illiquid Asset, Liquid Markets

Illiquid Asset

An asset that is difficult to sell because of its expense, lack of interested buyers, or some other reason. Examples of illiquid assets include real estate, stocks with low trading volume, or collectibles. Illiquid assets still have value and, in many cases, very high value, but are simply difficult to sell. See also: Liquid.
References in periodicals archive ?
First, illiquid investments limit investors' ability to adjust their portfolios in response to early warnings of an increase in systemic risk.
Often, the individuals in the best financial position to assist the plan in ridding itself of the imprudent illiquid investment couldn't do so because it would result in a prohibited transaction.
Assuming all other factors are equal, an illiquid investment is inferior to and worth less than a liquid investment.
The importance of a clear exit strategy is central to an effective investment strategy today, so as to avoid the pitfalls of having a continuous illiquid investment.
By making this offer, Beach is extending an opportunity for all Adelaide Energy shareholders to capture the underlying value of their investment ahead of significant funding requirements, as well as giving them an exit from what is an illiquid investment that has never closed above its listing price of 20 cents.
Basic financial theory suggests that an illiquid investment that is expected to pay regular dividends or distributions is worth more than an otherwise identical investment That has no expected distributions.
Further, a taxpayer who invests funds in speculative or illiquid assets has not exercised ordinary business care and prudence in providing for the payment of his tax liability unless, at the time of the investment, the remainder of the taxpayer's assets and estimated income will be sufficient to pay his tax or it can be reasonably foreseen that the speculative or illiquid investment made by the taxpayer can be used (by sale or as security for a loan) to realize sufficient funds to satisfy the tax liability.
In a brief interview with CNBC following the SEC meeting, White said fund holdings in illiquid investment would be capped at 15% of the portfolio, and while she said the SEC would provide "guidance" as to what holdings could be considered illiquid, the funds themselves would make the final determination.
Additionally, KIC funds part of its illiquid investment portfolio with short-term deposits sourced from only a handful of names, including KIA and other cash-rich government-related entities.
But retail investors should realise that chasing a higher yield by investing in these products could mean winding up with an expensive, risky, complex and illiquid investment.
But retail investors should realize that chasing a higher yield by investing in these products could mean winding up with an expensive, risky, complex and illiquid investment.