Based on the search results, here are some common methods that private debt managers use to communicate the risks associated with illiquidity to investors:
- Providing regular financial statements: Private debt managers can provide regular financial statements of the borrower issuing the private placement debt to investors 1 . These statements can help investors understand the performance of their investments and the liquidity of the underlying assets.
- Being transparent about liquidity risks: Private debt managers can be transparent about the liquidity risks associated with their investments and provide investors with information on how they manage these risks 2 .
- Using backward-looking analysis: Private debt managers can use backward-looking analysis to present performance and attribution reporting to investors 3 . This approach can help investors understand how their investments have performed in the past and can provide insight into the liquidity of the underlying assets.
- Providing information on market trends: Private debt managers can provide information on market trends, performance data, and regulatory developments in the private debt market to help investors evaluate the liquidity of their investments 4 .
In summary, private debt managers can communicate the risks associated with illiquidity to investors by providing regular financial statements, being transparent about liquidity risks, using backward-looking analysis, and providing information on market trends. By communicating these risks effectively, private debt managers can help investors make informed investment decisions and protect themselves from the risks associated with private debt investments.