Liquidity risk refers to the losses suffered by assets in the market and the resulting costs, which is a comprehensive reflection of asset liquidity. The liquidity risk of open-end fund refers to the asset loss or uncertainty of transaction cost caused by the fund manager's difficulty in realizing his portfolio at a fair price within a reasonable time when facing the redemption pressure of the holder. When there is a mismatch between liquidity providers and liquidity demanders, it often leads to a decrease in liquidity. Generally speaking, liquidity risk depends on two factors. From the perspective of capital supply, it depends on the stock market and the money market. From the perspective of capital demand, it depends on the structure of fund holders. Liquidity risk is the concentrated expression of all risks in the operation of open-end funds, such as operational risk, market risk and operational risk, which will erupt through the accumulation of liquidity risk. Therefore, the research on the liquidity risk of open-end funds focuses on the comparative study from two aspects: the realization of securities assets and investor redemption.

The liquidity risk of open-end funds refers to the uncertainty loss caused by the uncertainty of investors' redemption time and redemption quantity, and its extreme situation is similar to the risk of bank run.

The liquidity risk of open-end funds mainly includes the following three aspects:

The first is the research on the investor demand of open-end funds, that is, due to the change of investor demand, funds continue to flow in and out, which leads to the liquidity risk of open-end funds.

Secondly, the liquidity of assets and the allocation ratio of current assets are studied. Liquidity measurement indicators mainly include transaction amount, turnover rate, depth, price difference, flexibility and timeliness.

The third is the institutional arrangement of liquidity risk management, that is, the regulations made by the regulatory authorities to deal with the liquidity risk caused by investor redemption, including the institutional arrangements for normal redemption and huge redemption.