Introduction
Traditional banks are shifting away from credit markets while Private Debt gains importance, filling a gap for investors. Discover why Private Debt is attracting increasing attention.
Benefits of Private Debt
Higher Returns
Private Debt generally yields higher returns than Public Debt, driven by factors like illiquidity premium and tailored loan structures.
Enhanced Risk-Reward Profile
Funding smaller and mid-sized companies can offer attractive risk-reward profiles with less competition among lenders.
Less Market Volatility
Investors typically hold Private Debt funds until maturity, focusing on cash flows over market price fluctuations.
Private vs. Public Debt
Convergence and Divergence
Recent market trends have blurred the lines between Private and Public Debt, with institutional investors showing increased interest in credit investments.
Future Outlook
Retail Investor Influx
Anticipated growth in retail investors in Private Debt requires industry evolution and tailored products to meet their needs.
Regulatory Changes
Authorities may introduce new frameworks to protect investors and support access to alternative investments.
Opportunities and Challenges
Private Debt stands to benefit from stable credit conditions but must navigate geopolitical risks for sustained growth.
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