Liquidity management

Many investment opportunities are illiquid, meaning that investors cannot withdraw their money for a certain period (which can even be several years) or unless they give certain notice periods (e.g. 1 or 2 years). Many investors are attracted by the returns of illiquid investments, and are ready to make such longer-term investments, but at the same time want to feel that they can withdraw their money early if they need it unexpectedly. Using Securitisation, an investment professional can choose, for example, 20% liquid and 80% illiquid assets. A limited number of investors can then withdraw their entire investment early. The Securitisation manages liquidity by occasionally withdrawing amounts from the illiquid asset and investing them into the liquid asset. If each investor separately invested 20% of their investment into the liquid asset and 80% into the illiquid asset, without the Securitisation, none of them would be able to withdraw it early in case of unexpected need.