Hi;
Can someone clearly explain what we mean by segmentation premium with respect to alternative investments and how this compares with liquidity premium as regards the same asset class.
-J作者: JRossSter 时间: 2011-7-13 14:56
Are you referring to the liquidity preference theory and the market segmentation theory with respect to yield curves?作者: eagles_dare13 时间: 2011-7-13 14:56
Segmentation premium is the extra return an investor receives in exchange for an inadequate price discovery mechanism. Examples include art and most venture capital investments.
A lack of liquidity in a market will certainly result in wider bid offer spreads but does not necessarily mean price discovery is indadequate.作者: btcapital 时间: 2011-7-13 14:56
I'd prefer to call the segmentation premium a 'segment premium'. Its the premium an investor expects to earn for investing in asset classes that have an incomplete, unsophisticated or inadequate price discovery mechanism. Ashonfire's examples should drive the point home...
