Steve Persky, Dalton Investments

Judgement and experience are critical. The first judgement is whether the illiquid securities are appropriate for the liabilities under management. If managing a fund that provides monthly or quarterly redemptions to clients, then having illiquid securities can pose a major problem if redemptions occur.

In bull markets there can be apparent liquidity for many types of securities which will become extremely illiquid in an adverse market. Experiencing the illiquidity of a bear market is really the