Illiquid Market

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Illiquid Market

A market in which that is difficult to sell assets because of their expense, lack of interested buyers, or some other reason. Examples of illiquid markets include real estate, some stocks with low trading volume, or collectibles. Assets in illiquid markets still have value and, in many cases, very high value, but are simply difficult to sell. See also: Liquid.
References in periodicals archive ?
Poorly developed capital markets, illiquid markets, and rel- atively high interest rates for local loans are some of the challenges af- fecting project developers' efforts to raise finance locally.
The stratospheric levels of leverage in the debt markets and Dodd Frank/Volcker Rule related fall in bank capital dedicated to market making means that the spike in the US Treasury bond yields could become chaotic in illiquid markets.
Some parties have strong opinion that fair value accounting has a major contribution in strengthen credit crises, specially pointing to the obvious difficulties of measuring the fair values of subprime positions in the current illiquid markets and the feedback effects noted above.
OConstraint will be driven by illiquid markets and the shrinking balance sheet capacity of international banks to lend significant sources of new money.
It is also best to avoid illiquid markets, such as Bahrain and Oman, when the grizzlies rule the roost.
The investment universe comprises all the currencies of the MSCI World and MSCI Emerging Markets indices, with the exception of some illiquid markets.
But investors have been worried by the shallow, sometimes illiquid markets of the Mena region.
The sheer number of new funds implies that many ETFs are covering the same index but also that a multitude of funds are now covering very narrow or exotic market segments, often resulting in high costs, illiquid markets and non-transparent investments.
As a result, financial statements incorporating fair values of assets and liabilities in unstable or illiquid markets are likely to be neither reliable nor relevant for decision usefulness.
Hence, when illiquid markets that finance investment funds during the crisis hardened, the funds were no longer able to meet the requests imposed by investment banks, thus becoming propagators of systemic risk.
The credit-crunch which forced the very significant downturn in economies around the globe had a devastating impact and was reflected in the huge losses in most stock markets around the world with only smaller illiquid markets, such as Namibia's own local index not being immediately affected.
It's worth noting that the existing fair value rules still stand; these FSPs provide additional implementation guidance on valuing assets in illiquid markets, the likes of which could not have been anticipated when the mark-to-market accounting rules were first contemplated.