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Laxman Pai, Opalesque Asia: The hiatus in global bond markets could accelerate the move by some investors into private debt, said a study. According to Preqin Pro, so far this year, a total of $174bn has been raised for 141 private debt funds globally.
"This compares favorably with $178bn in the whole of 2020 (a record 284 funds), and the record total of $215bn raised in 2021 (273 funds)," the report pointed out.
Private debt managers prove more active than the other asset classes, with funds in the market growing at a CAGR of 41% per year from 2018 and 2022, it said.
According to the report, private capital managers sought to take advantage of this strong growth and performance from 2018 to 2021 by launching new funds.
Between August 2018 and August 2022, private debt managers were the most active, with funds in the market growing at a CAGR of 41% per year, far outpacing the growth in all other asset classes, it said.
Meanwhile, most private debt loans are floating rates, so their valuations are less vulnerable to base-rate hikes. The number of private debt funds in the market has also increased faster than in any other alternative asset class, rising from 199 in 2018 to 787 in 2022.
The average fund size is trending steadily upward. It stood at approximately $500mn in 2017 and is at $1.2bn so far this year - although the latter figure is likely to come down as more data about smaller funds is collated.
"The longer-term outlook ...................... To view our full article Click here
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