Research & Insights
Liquidity Premium - Literature review of theoretical and empirical evidence
John Hibbert
The price of liquidity – the liquidity premium – and its variability is currently the subject of enormous interest from accountants, actuaries, financial intermediaries and regulators. The outcome of the debate will have an impact on the future price of certain financial products and, arguably, the cost of finance for firms using the capital markets. The primary purpose of this report is to provide a summary of the main conclusions of researchers, with the objective of refining liquidity premium estimation methods.
