Alternative Investments 2.0. Группа авторов

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СКАЧАТЬ rel="nofollow" href="#ulink_a6ef6581-88cf-543b-ae48-f0ddc4d5966d">Overview 2.3.2 Market Growth 2.3.3 Risk-adjusted Returns 2.3.4 Investment Considerations 2.3.5 Outlook 2.4 Co-Investment and Secondaries in the Corporate Private Debt Space 3 Return Drivers of Private Debt Investments 3.1 Base Loan-related Factors 3.2 Direct Lending Specific Factors 3.3 Portfolio Positioning through the Credit Cycle 4 Risk Mitigation and Success Factors When Investing in Private Debt 4.1 Market & Loan Level Data 4.2 Investment Control 4.3 Lender of Record 4.4 Deployment 4.5 Flexibility 4.6 Diversification 4.7 Workout Capabilities 4.8 Economies of Scale Bibliography

1 Introduction

      Private debt is a fascinating and rapidly evolving asset class. In market penetration and maturity, it is quickly catching up with its older sibling, private equity. It is also following many of the historical trends around fundraising and evolution of co-investments and secondaries in the private equity asset class.

      Part of the strong growth of private debt is driven by the inflow of capital from institutional investors identifying higher yields in a low-interest-rate environment, finding a product that mitigates the J-curve for their private equity investments and concluding that debt funds solve a financing gap left by banks. This trend is further driving the migration of capital and talent from public to private markets.

      However, we believe the asset class is still in its early days. The near-to mid-term market challenges implied by the COVID-19 outbreak will prove a true stress test for General Partners’ (GP) track records and for the performance of different strategies. Such dislocations, though unlikely to change the fundamentals supporting the long-term growth of private debt, will have a significant impact on the evolution of the asset class, for existing GPs and prevailing strategies.

      This contribution aims to provide the reader with some helpful insights about successful private debt investing. The analyses presented hereafter should help investors to construct robust portfolios and navigate through stressed periods comfortably. We make use of a large proprietary database to add colour to some of the concepts presented in this contribution and to demonstrate the value of data in what remains an opaque asset class. Partnering with GPs and other market participants proves to be a valuable strategy for private debt investors. Besides being a precious source of information, these relationships can also provide the investors with investment opportunities reserved for a limited number of participants.

2 Investment Case

2.1 Introduction to Private Debt

Until recently, banks were the primary provider of debt capital to corporations. Using an “originate to distribute” model, a single bank underwrites an entire loan facility and СКАЧАТЬ