Beyond the Stock Exchange: Exploring Private Debt Opportunities

In today's episode, Warren Ingram and Conway Williams, Head Of Credit at Prescient, discuss the often-overlooked realms of private debt, particularly in the South African context. They explore the definitions, differences, and investment strategies associated with these asset classes, emphasizing the importance of understanding liquidity, risk, and diversification. The discussion also highlights the potential for impact investing through private debt, showcasing how investments can contribute to economic and social development while still providing competitive returns.

Takeaways

• Private debt provides lending opportunities with a focus on capital preservation.
• Investors in private debt sacrifice high returns for lower risk and priority in liquidation.
• Liquidity is a key consideration in both private equity and private debt investments.
• Private debt can offer returns above traditional fixed deposits, typically between 3-6% above call rates.
• Investing in private debt involves understanding the risks and potential credit events.
• Diversification is crucial to mitigate risks in private debt portfolios.
• Private debt can fund impactful projects like renewable energy and infrastructure.
• Investors should not allocate all their funds to private debt; a balanced portfolio is essential.
• Access to private debt investments can be achieved through specialized funds.

Get more insight on how Prescient Investment Management can help you here.

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