BDCs and private credit remain highly attractive
The bull case for Business Development Companies (BDCs) and alternative asset managers is that high yields and low default rates offer strong risk-adjusted returns.
The argument
The guest argued that fears regarding private credit defaults are overblown and already priced into the equities. With yields around 9% or higher, these vehicles provide robust income even if stock prices remain flat.
The thesis, stress-tested
✓ What validates it
- ✓BDCs maintaining or increasing their dividend payouts
- ✓Default rates in the private credit space remaining below historical averages
▸ Risks discussed
- ▸Spikes in high-yield debt defaults beyond current low levels
- ▸Redemption pressures on alternative asset managers
Hear it yourself
"I I think their yields are very attractive. I think the alternative asset managers like Blue Owl are attractive. I think but I would say, like, in a year, you should be happy with these positions."
00:00 / 00:17
AFFILIATE LINK · ZORTIX MAY EARN A COMMISSION · NEVER A RECOMMENDATION TO TRADE