Vesna Sipp

Private Credit - huge retail demand Just like private Equity before it, private credit has historically been difficult for retail investors to access due to a variety of factors including, illiquidity fragmented smaller deal size, and lack of proper structure for distribution All that has changed thanks to larger investment houses like Blackrock making the distribution of this product easier and more homogeneous As a retail investor you definitely want some of this in your portfolio... important considerations are low correlation to liquid public markets interesting deals with higher returns, focus on smes and other segments of the market that typically are not accesible to retail and have a wider variety of more interesting companies with higher potential returns The three ways you make money in fixed income are Credit rating Duration/ maturity Illiquidity premium Private credit /private debt which is essentially smaller illiquid deals with direct lending from specialized institutional players can give you access to all three components They benefit from being in most cases sub investment grade so you get a decent pickup over risk free rates You generally speaking have a longer hold period usually 7 years so you get the benefit the shape of the yield curve and most importantly You pick up what I refer to as the illiquidity premium I.e. illiquid bonds that cannot be sold easily will have to pay investors a premium over liquid bonds which can be bought and sold more easily I will be speaking on a panel about private credit at the Fixed Income Leaders Summit October 2nd to the 4th I highly recommend you either attend or try to get a transcript as many of the issues that we will be discussing are interesting for retail investors who may not have access this asset class before Really exciting asset class with higher returns lower overall correlation to markets and acesss to comapnies you cant acess normally (dont have equity) through professional managers Private debt is hot and is finally becoming easily accessible by retail investors #privatedebt #privatecredit #privateequity #bonds #stocks #investments #blackrock BlackRock and Partners Group team up in latest effort to target wealthy - https://on.ft.com/3Znin7x via @FT

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