Groundlearn / Glossary / Lock-up period
Lock-up period
A CFA and FRM term, defined in plain English with the distinction examiners test.
What it means
The period during which an investor may not redeem from a fund.
The exam angle
Gates and side pockets do a similar job in a crisis, and all three are liquidity risk rather than fine print.
Where it appears in the syllabus
- Alternative InvestmentsCFA Level I · exam weight 6–9% · Private capital, real estate, natural resources, hedge funds, digital assets.
- Liquidity & Treasury RiskFRM Part II · exam weight 15% · Funding vs market liquidity, LVaR, transfer pricing, IRRBB, LCR and NSFR.
Related terms
- Illiquidity premiumThe extra expected return demanded for holding an asset that cannot be sold quickly at a fair price.
- Return smoothingUnderstated volatility caused by infrequent or appraisal-based valuations rather than by genuinely stable prices.
- Capital callThe general partner’s demand that limited partners transfer part of their committed capital.
- Capitalisation rateNet operating income divided by property value — a property’s unlevered income yield.
- Carried interestThe general partner’s share of a private fund’s profits, typically around 20%.
- Contango and backwardationContango is a futures price above the spot price; backwardation is a futures price below it.
Educational content only. This is not financial, investment, legal or regulatory advice. Check the official curriculum for your own exam before relying on any definition here.
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