Post by MA Financial Group

In his latest interview with ausbiz’s Andrew Geoghegan, our Head of Global Credit Solutions Frank Danieli unpacks the growing disconnect between how “private credit” is commonly defined and the reality of the asset class. Reinforcing themes from his latest quarterly investor letter, Frank notes: “What everyone's talking about is private credit actually means just one part of the market – leveraged finance …That's about 15% of all private debt. But in many private credit funds, especially in the US, it's 100% of their mandate.” He also outlines why diversification is fundamental in private credit investing: “In credit, concentration is just not your friend. In equities you can make money with concentration, but in credit you need really good diversification. And that doesn't just mean lots of granular stuff – it means the ability to participate in different parts of the lending market, and to weight up and weight down your portfolio, depending on what you're seeing in the real world. And a lot of people haven't done that. So, I think you're going to see through this period of time who has and who hasn't, and those who've set themselves up with a broad-based exposure – they’ll have the staying power.” Visit our website to explore more. • AusBiz interview library: https://lnkd.in/gUN5-nrS • Frank’s quarterly investor letter: https://lnkd.in/dm2Y3tGA

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