What is Lockup Period?
Lockup Period A predetermined span of time during which investors in a hedge fund, private equity fund, or similar pooled vehicle are prohibited from redeeming or withdrawing their capital. Commonly set to protect fund liquidity and stabilize asset management during initial investment or critical operations phases.
Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework
How is “Lockup Period” Used in Practice?
The lockup period ensures that investors cannot redeem their shares during the fund's initial three years, supporting long-term investment strategy.
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Who Needs to Know This Term?
- Financial Analysts
- Bankers
- Traders
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What is Lockup Period?
A predetermined span of time during which investors in a hedge fund, private equity fund, or similar pooled vehicle are prohibited from redeeming or withdrawing their capital. Commonly set to protect fund liquidity and stabilize asset management during initial investment or critical operations phases.
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