Investors set to increase allocation to private debt


41 per cent of investors are likely to increase their allocation to private debt in the next 12 months. 15 per cent said that they would increase their allocation significantly, while 29 per cent said it would remain the same.

The research study also revealed that a staggering 73 per cent of investors said their investments had met or exceeded expectations, while only 13 per cent reported investments as having fallen short of their expectations.

In comparison to only 7 per cent of investors who believe the private debt market will shrink over the next 12 months, 41 per cent are positive about the outlook for private debt which, a diversification play, is perceived as having superior protections versus traditional bonds and equity-like returns.

Charles Le Cornu, Head of Private Equity at Elian commented: “Complex strategies seen from traditional institutional lenders following the financial crisis have continued to weigh heavily on business growth. As a result, there has been a significant increase in demand for forms of alternative lending, specifically as institutional investors come up against continuing low yields from mainstream fixed interest vehicles.

“While private debt is still in its infancy as an asset class, this research clearly shows that investors are responding positively in their allocation levels. This is being driven by the robust performance private debt investments have demonstrated, and indeed continue to deliver.”