Illiquid asset management is the specialized discipline of managing assets that cannot be readily converted to cash — requiring expertise in valuation, market creation, and strategic patience to maximize recovery value.
At CRAGSI, we define illiquid asset management as the specialized discipline of managing assets that cannot be readily bought or sold at observable market prices — including distressed securities, bankruptcy claims, private equity, LP interests, real estate, intellectual property, and other alternative investments — to maximize value recovery over time.
Illiquid assets are both the most challenging and the most rewarding area of investment management. The illiquidity premium — the extra return investors demand for accepting the inability to exit at will — can be substantial. But capturing that premium requires patience, expertise, and the institutional infrastructure to hold and manage positions over multi-year time horizons without being forced to sell at distressed prices.
CRAGSI's founding team spent decades managing illiquid assets for institutional clients — including the PBGC's special situations portfolio and the FDIC's bank receivership portfolios. The most common failure in illiquid asset management is the imposition of artificial liquidity — forcing sales at distressed prices because of arbitrary time horizons, regulatory pressure, or management fatigue. Our approach is to work toward intrinsic value on each asset's own timeline, using the full toolkit of valuation, market creation, and negotiation to maximize recovery.
Related CRAGSI services: Workouts · Asset Dispositions · Valuations