As a level 3 asset it can't be marked to market and the value might not change on a daily basis.
Level 3 is the least marked to market of the categories, with asset values based on models and unobservable inputs — assumptions from market participants are used when pricing the asset or liability, given there is no readily available market information on them. Level 3 assets are not actively traded, and their values can only be estimated using a combination of complex market prices, mathematical models and subjective assumptions.
Examples of Level 3 assets include mortgage-backed securities (MBS), private equity shares, complex derivatives, foreign stocks, and distressed debt. The process of estimating the value of Level 3 assets is known as mark to management.
Because they can:
Mutual funds have restrictions in terms of buying private equity directly due to the SEC's rules regarding illiquid securities holdings. The SEC guidelines for mutual funds allow up to 15% allocation to illiquid securities. Also, mutual funds typically have their own rules restricting investment in illiquid equity and debt securities. For this reason, mutual funds that invest in private equity are typically the fund of funds type.