Liquidity premium: myth or reality?
Document ID: 2009-1610
Published on: 30th September 2009
Author: John Hibbert
The existence, magnitude, measurability and applicability of liquidity premia are currently the subject of a lively debate among practitioners, accountants, actuaries and regulators. The outcome of the debate will have an impact on the future price of certain financial products and the capital required to support them as well as, arguably, the cost of finance for firms selling illiquid debt through the capital markets.
