Liquidity Risk Archives

Greensill

The Essence of Risk Management – Lessons from Greensill Greensill. History does not repeat, but sometimes it rhymes. And then sometimes it does actually repeat. Long story short, magician financier reinvents a neglected area of finance, adds some secret sauce and hey presto, turns BBB or worse assets into AAA assets that yield AA returns. […]

May 7, 2021, by administrator

CP86

CP86: A Risk Managers Perspective So, it is finally here – the much-vaunted Central Bank of Ireland (“CBI”) feedback on the implementation of CP86[1]. From a purely risk management perspective the path this leads ManCos/UCITS and AIFMs down is interesting. It is widely acknowledged in the Irish funds industry that any application to set up […]

November 4, 2020, by administrator

Illiquidity

There is nothing like jumping on a bandwagon to validate one’s internal prejudices, however it must be admitted that some of the criticism of the Woodford fund management process is entirely justified. Firstly, given the mostly rational stance that adherence to long term investment principles is predicated on rising asset values, requiring investors to be […]

June 18, 2019May 30, 2022, by administrator

IMF warns Luxembourg Funds Industry

In a newspaper article in Luxemburger Wort it was reported that the International Monetary Fund (IMF) has warned Luxembourg regulators that they must increase their monitoring of risks in the investment fund industry. “The typical model adopted by Luxembourg fund managers involves significant delegation of activities, often including portfolio and risk management,” the IMF report […]

September 1, 2017, by administrator

The SEC and Liquidity Risk

In October the Securities and Exchange Commission (SEC) adopted liquidity rules1 for mutual funds and ETFs to allow fund boards, the SEC and investors to “better monitor liquidity risks” in those investing vehicles and to “modernize and enhance liquidity risk management”. Whilst the Investment Company Act provides for a seven day settlement period to repay investors […]

November 22, 2016, by administrator

Redemption Gates

Redemption Gates and Liquidity Management There are some interesting discussions going around concerning redemption gates. This has been raised at SEC money market hearings over the past year or so. Jennifer Marietta-Westberg, Deputy Director and Deputy Chief Economist in the Division of Economic and Risk Analysis (DERA), stated: “Redemption gates will provide a fund’s board […]

March 4, 2015, by administrator

Risk Management for Real Estate Companies

Property Risk An analysis of AIFMD as applied to Real Estate Investment Trusts and Property Companies The Alternative Investment Fund Management Directive (AIFMD) is a piece of European Union legislation aimed specifically at “non-standard” funds that wish to operate and market themselves within the Union. In direct response to the recent financial crisis there are […]

March 3, 2015, by administrator

Bill Ackman

Bill Ackman of Pershing Square is launching a closed ended hedge fund listed on the Amsterdam Stock Exchange. What was interesting is that the fund was closed ended (or permanent capital) meaning that Ackman does not have to worry about subscriptions but more importantly redemption’s (which inevitably come at exactly the wrong time – usually […]

October 7, 2014, by administrator

Tag: Liquidity Risk