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ARTICLE · 08 JULY 2026

Structuring Smart: Why Liquidity Management Starts Long Before A Crisis

McDermott Will & Schulte
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Fund managers face competing pressures when designing liquidity frameworks, but effective management begins long before market volatility strikes. This analysis explores how aligning liquidity terms with portfolio realities, preserving strategic optionality through careful documentation, and maintaining strong governance can protect both investments and investor relationships during periods of market stress.

United KingdomFinance and Banking
Christopher Hilditch
Christopher Hilditch
Amy MacDonagh
Amy MacDonagh
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Overview

Watch panel video here, if helpful.

Liquidity is often discussed as a crisis management issue. In reality, effective liquidity management begins long before markets become volatile.

During London Hot Topics 2026, Christopher Hilditch and Amy MacDonagh explored how fund managers can build resilient liquidity frameworks that protect both portfolios and investor relationships. Their discussion highlighted a simple but important principle: The most effective liquidity tools are those that are carefully designed before they are ever needed.

In depth

Start with the portfolio, not investor demands

When designing liquidity terms, managers can face competing pressures from investors, peers, and market expectations. However, the discussion emphasised that liquidity terms should always be driven by the underlying portfolio and investment strategy.

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