•  
• Tweet
•  
•  
•        Print
•  
•        Email
•  
•         Track Keywords

Private credit was worth $1.5 trillion in 2024. By 2030, 55% of fund managers surveyed think this will have grown to between $1.7 trillion and $1.8 trillion, the study found. Over the two decades from 2004 to 2024, annualised returns from private credit funds were 5.5% a year higher than global high-yield bond funds.

Over the next five years, 90% of fund managers think this annualised return will increase slightly, while 10% believe it will stay the same. The research found that almost all fund managers believed private credit was useful as a defensive asset class, as private loans are typically secured against collateral and so have priority in companies' capital structure hierarchy. Almost two-thirds (60%) said they strongly agreed with this, while 40% slightly agreed.

The two main types of private credit fund managers focus on direct lending - directly negotiating a loan between borrower and lender - and alternative strategies, which include distressed debt, rescue financing and specialty finance. Direct lending will be the most successful in attracting funds from retail investors who are interested in investing in private credit, according to 60% of fund managers surveyed. The remaining 40% opted for alternative strategies.

Private credit is also regularly invested in by fund managers themselves. More than half (60%) of fund managers surveyed had between 10% and 25% of their personal investments in private credit, excluding property wealth. Meanwhile 35% of fund managers had between 5% and 10% of their own investments in private credit.