Arms investors with powerful new tools for measuring and managing the risks associated with the various illiquid asset classes With risk-free interest rates and risk premiums at record lows, many investors are turning to illiquid assets, such as real estate, private equity, infrastructure and timber, in search of superior returns and greater portfolio diversity. But as many analysts, investors and wealth managers are discovering, such investments bring with them a unique set of risks that cannot be measured by standard asset allocation models. Written by a dream team of globally renowned experts in the field, this book provides a clear, accessible overview of illiquid fund investments, focusing on what the main risks of these asset classes are and how to measure those risks in today's regulatory environment. Provides solutions for institutional investors in need of guidance in today's regulatory environment - Offers detailed descriptions of risk measurement in illiquid asset classes, illustrated with real life case studies - Helps you to develop reliable risk management tools while complying with the regulations designed to contain the individual and systemic risks arising from illiquid investments - Features real-life case studies that capture an array of risk management scenarios you are likely to encounter “This important book is long overdue. As investments in higher-yielding illiquid assets continue to grow, there is an urgent need to understand their specific risk characteristics. Mastering Illiquidity fills a critical gap by providing a detailed guide for investment professionals to measure and harvest illiquidity premiums methodically while avoiding the numerous performance measurement traps private equity and similar asset classes can bring about. I strongly recommend it.” ― John B. Breen , Sanabil Investments “This is a timely and much needed treatment of key issues facing investors making significant and often growing investments in private equity and real assets. These illiquid assets pose great challenges and opportunities for improved practice and research. How do we measure risk? What are the costs of illiquidity? Writing in an accessible manner, the authors blend a wealth of data, practical insight and research findings that can both inform a newcomer to the area and benefit the seasoned professional investor. I highly recommend the book to anyone interested in investments in illiquid assets such as private equity. I am already suggesting it to students as well as colleagues in the academy and industry.” ― Robert S. Harris , C. Stewart Sheppard Professor, Darden School of Business, University of Virginia “This book is extremely well written and well structured. It integrates evidence, theory, academic research and practical applications very effectively. Written in an accessible and yet precise way, the book is an excellent contribution to the literature which should be widely read by practitioners, students and academics. The topic is important and complex and the authors really have provided the handbook for all investors interested in the illiquid assets.” ― Tim Jenkinson , Professor of Finance and Head of Finance Area, Director, Private Equity Institute, Said Business School, Oxford University “Managing illiquid assets is a daunting task. For the limited partnership structure to be viable in the long-term, asset managers must master appropriate risk management tools. This book is an outstanding contribution towards this goal and, as such, an invaluable gift to the asset management industry.” ― Ludovic Phalippou , Lecturer in Finance (Fellow of Queen’s college), University of Oxford, Said Business School “With the growing institutional allocations to alternative assets, such as private equity and venture capital, concerns about risks and risk management are receiving increasing attention from both investors and regulators. In this book, some of our leading thinkers and practitioners provide a state-or-the-art overview of these issues, including extensive discussion of the particular complications that arise from the long-term illiquidity of these alternative investments. It comes highly recommended.” ― Morten Sorensen , Daniel W. Stanton Associate Professor of Business, Columbia Business School “Illiquid assets are important drivers of portfolio performance, which do not fit the standard management frameworks for liquid assets. Mastering Illiquidity is the reference for portfolio and risk managers who want to avoid the numerous pitfalls in the management of illiquid assets.”― Christophe Rouvinez , Chief Executive Officer, Müller-Möhl Group Allocations to illiquid investments have grown substantially in recent years as investments in asset classes such as private equity, real estate, infrastructure or timber, are expected to generate superior returns and help investors diversify their portfolios. Their unique characteristics however, require specific tools to measure and manage the