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Private credit continues to play an increasingly important role in portfolios at a time when isolated stress fuels concern among investors new to the asset class. PGIM’s Dianna Carr-Coletta provides context on current conditions, identifies emerging opportunities, and details the attributes investors should seek in pursuit of resilient allocations.
Key Takeaways
Look beyond headline risk. Current conditions reflect isolated stress linked to specific vintages and sectors rather than broad deterioration across the asset class.
Manager selection is critical. Selecting experienced managers with underwriting discipline, covenant protections, sourcing depth, and proven workout capabilities helps drive resilient long-term outcomes.
Private credit is a strategic allocation. Investors should not expect to trade around private credit, highlighting the importance of investor education regarding liquidity, income, and holding periods.
Author
Dianna Carr-Coletta
Head of Non-Sponsored Middle Market Direct Lending
FOR FINANCIAL PROFESSIONAL USE ONLY. NOT FOR USE WITH THE PUBLIC.
The views expressed herein are those of PGIM’s credit investment professionals at the time the comments were made and may not be reflective of their current opinions and are subject to change without notice. Neither the information contained herein, nor any opinion expressed, shall be construed to constitute an offer to sell or a solicitation to buy any security.
Certain information in this commentary has been obtained from sources believed to be reliable as of the date presented; however, we cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of the date of issuance (or such earlier date as referenced herein) and is subject to change without notice. The manager has no obligation to update any or all such information, nor do we make any express or implied warranties or representations as to the completeness or accuracy.
This material is being provided for informational or educational purposes only and does not take into account the investment objectives or financial situation of any client or prospective clients. The information is not intended as investment advice and is not a recommendation. All investments involve risk, including the possible loss of capital. Private credit investments are generally illiquid.
Prudential Investment Management Services LLC is a Prudential Financial company and FINRA member firm. PGIM Investments is a registered investment advisor and investment manager to PGIM registered investment companies. All are Prudential Financial affiliates.
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