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A lock-up is a period during which sell orders or redemptions from a fund are either completely restricted (hard lock-up) or are subject to an early redemption fee (soft lock-up). A fund can have a hard lock-up, soft lock-up, or both.

They are common for private markets funds during their initial stages and are implemented to discourage withdrawals given the long-term and illiquid nature of these investments.

A hard lock-up is the period during which sell orders or redemptions from a fund are not permitted.

A soft lock-up is the period during which sell orders or redemptions from a fund are subject to an early redemption fee.

If your investment is within the soft lock-up period and you place a sell order, the amount you receive will be discounted by a percentage value (as defined by the fund) called an early redemption fee.