About the report

The rise of private credit assets under management is by no means unexplained: as an asset class, it encompasses a wide spectrum of risk and return as well as capital appreciation and yield generation profiles. In the white paper, we explore the many compelling attributes of private credit, the third-largest asset class in the alternatives space, and how it can be added to a mature portfolio.

Key highlights

• Why has private debt grown in the last decade? The growth of the asset class mainly comes down to the 2008-2009 global financial crisis. Sweeping regulatory changes that were applied in the aftermath of the market turmoil required that the banks were no longer able to hold the same levels of exposure on their balance sheets.

• Different forms of private debt and risk spectrum There is a wide-range of strategies that fall under the umbrella of private debt, including direct lending, specialty lending and credit opportunities, mezzanine and distressed. An expected net return range can be attributed to each of these strategies, relative to the amount of risk being taken.

• How to incorporate private debt into a portfolio? Private debt can be a good addition to a mature portfolio inclusive of private equity for its lower volatility, diversification benefits, downside protection offered through the attractive risk-return profile and income generating abilities of the asset class.

‍‍‍‍Important notice: This content is for informational purposes only. Moonfare does not provide investment advice. You should not construe any information or other material provided as legal, tax, investment, financial, or other advice. If you are unsure about anything, you should seek financial advice from an authorised advisor. Past performance is not a reliable guide to future returns. Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Subject to eligibility.