“Thank you for this series. I’m curious how the benchmark accounts for where the loan is in the cap structure? For example, recovery rates for unitranche, 1st lien and second lien are different. Any portfolio would have to match the composition to effectively compare against the benchmark. Otherwise, you would need different benchmarks for each.”…

Private debt, compared to private equity and real estate, is a relatively recent entrant to the alternative asset class. But that market has grown faster than others over the past decade. In 2007, just before the Great Recession, private debt AUM measured less than $200 billion. Today the universe of illiquid credit is $900 billion…

Back in January we featured content from Lincoln International’s Valuations and Opinion team [link]. Topics included Covid’s impact on private credit terms, structures and pricing. Shortly thereafter the team reached out to road test a loan index created from Lincoln’s quarterly valuations of 2,400 private companies. Metrics included total return, price, spread, and yield to…