The View From Apollo How Important Is Vintage in Private Credit Investing Today?
Sep 5, 2023
Jim Vanek, Co-Head of Global Performing Credit at Apollo, shares his expertise on the evolving credit markets and the importance of vintage in investing strategies. He discusses the challenges posed by rising interest rates and inflation, emphasizing the need for conservative lending practices. The conversation highlights lucrative opportunities in large-cap investments and the resilience of specific sectors, particularly healthcare technology. Personal insights on significant reads round out the rich discussion on navigating today's financial landscape.
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Strong Credit Market Performance 2023
- Credit markets have shown good performance in 2023 with floating rate strategies outperforming fixed rate ones.
- Valuations remain compelling, providing attractive go-forward yields despite strong year-to-date returns.
Refinancing Dominates Lending Market
- Lending market reflects refinancing focus with little new debt issuance for new corporate finance activities.
- Direct origination remains compelling with wide spreads versus public credit, driven by sponsor and company demand.
Be Methodical Deploying Capital
- Deploy capital methodically, carefully evaluating credit quality in an uncertain, high-interest environment.
- Focus on downside risk, especially with elevated interest costs and potential economic slowdown.