F FRONTIERSPACE Ventures

Private Markets Liquidity Stress Test for Institutional LPs

Test your full balance sheet against slower cash returns and faster capital calls. Include liquid assets, current NAV, unfunded commitments and regular cash needs. For pensions, endowments, family offices and funds of funds.

Questions this calculator answers1. If markets fall by 20%, could our portfolio pass a liquidity stress test and meet capital calls?2. How much cash would we need if funds pay us back later than planned?3. How much more could we commit while keeping our cash reserve safe?

Liquidity under stress

The headline uses the severe path. The assumptions are examples. Results update as you change them.

Liquidity coverage — adequate
3.1×

Recommended liquidity reserve$36mFixed floor based on current liquid assets
Peak 12-month cash requirement$48mSevere case
Peak annual capital calls$31mSevere case
Lowest projected liquidity$94mSevere case
Stress-case liquidity buffer$41mLowest balance less reserve
Additional commitments before constrained$0mOne-time amount added at the start of Y1

Portfolio liquidity under stress

Liquid assets at year-end, after returns and all cash paid in or out. The dashed line is the fixed liquidity floor.

Severe minimum
Base caseModerate stressSevere stressLiquidity floor

Sources vs uses of liquidity

The severe case shows all cash in and out each year. Cash returned by funds and other inflows are set against capital calls and spending.

Severe case
Private-market distributionsExternal inflowsCapital callsSpending

Liquidity coverage ratio

Start with liquid assets after market returns. Add all cash inflows for the year. Divide this total by yearly calls and spending. The dashed threshold is 1.0×.

Threshold: 1.0×
Base caseModerate stressSevere stressMinimum threshold

How the test works

Each year, the model adds cash returned by funds and other inflows to liquid assets. It then takes out capital calls and spending. Severe stress uses the full settings; moderate stress uses half. Every chart follows the same balance-sheet path.

Questions LPs ask

What does liquidity coverage mean here?

Take liquid assets after returns and cash inflows. Divide by capital calls and spending. Below 1.0× means annual cash needs are greater than available liquidity.

Why is the liquidity reserve fixed in dollars?

The reserve starts as a percent of your liquid assets today. It then stays fixed in dollars so you can compare it over time.

Are future commitments included?

Not by default. The test starts with your current unfunded commitments. You can add new yearly commitments under Advanced.

How are severe and moderate stress defined?

Severe uses your full stress settings; moderate uses half. They are scenarios, not forecasts.

What is the additional commitments output?

It is the largest one-time addition to unfunded commitments that passes the severe case. The model must stay above the reserve and 1.0× coverage. This checks capacity; it does not set a yearly commitment plan.

Does this replace cash forecasting?

No. Actual calls, cash returned, value updates and sales of liquid assets can be uneven. Base decisions on current fund notices, operating forecasts and governing documents.

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