It is crucial to consider how investments will be sold before investing, says Cliffe. In the third instalment of a new 10-video series for eZonomics on lessons from the financial crisis, Cliffe outlines the importance of liquidity – or how easy it is to sell an investment. The series of 10 lessons show his personal view.
Cliffe discussed problems faced by money market funds in the downturn and troubles some investors had selling real estate.
“The credit crunch is a reminder that investors need to think about who they will ultimately sell their investments to,” he said. “It might be worth paying a bit more for more liquid investments.”