Cloud 9fin

Hedging our debts

5 snips
Aug 28, 2024
In this engaging discussion, private credit reporter Peter Benson and senior reporter Shubham Saharan dive into the rising interest of hedge funds in the private credit market, attracted by potential higher returns. They unpack the challenges hedge funds face in this competitive landscape, including skepticism from investors and tough fundraising conditions. The conversation also highlights the contrast between hedge funds and traditional private credit players, exploring the evolving dynamics and promising opportunities in this financial arena.
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INSIGHT

Hedge Funds' Private Credit Pursuit

  • Hedge funds are entering private credit due to investor demand for higher returns.
  • Private credit has recently outperformed traditional credit funds, making it attractive.
INSIGHT

Fundraising Challenges

  • Fundraising is challenging in the current environment, making it difficult for new entrants to stand out.
  • Limited Partners (LPs) seek managers with proven track records, not just brand recognition.
ANECDOTE

Fidelity's Exit

  • Fidelity recently exited European direct lending after only seven months.
  • This was attributed to struggles with both fundraising and dealmaking.
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