Shares plunged in the US and Europe this week over shadow banking fears - Spencer Platt/Getty Images The frenzied stock market sell-off that gripped the US and UK this week was fuelled by fear as much as fact. Investors saw what could easily be the tip of an iceberg, and nobody knows quite what lies beneath. Two car parts suppliers with multibillion-dollar debts in the private credit market have gone bust amid allegations of fraud, and two regional US banks have uncovered a clutch of irredeemably bad loan ...

All the major averages down. The VIX hitting the highest level since May and the 10-year yield dipping below 4%. Russell 2000 down about 2% on concerns about bad loans in the banking industry.This as trade tensions persist and the government shutdown drags into its third week. Break it all down with our next guest, HSBC chief investment officer of the Americas, Jose Rasco. Jose, start with these uh regional banks.How concerned are you. Well, I mean, look, we have liquidity problems clearly and um not not la ...

Core Insights - Larry Fink, CEO of BlackRock, emphasizes that the tokenization of assets is just beginning, with a focus on integrating various asset classes into digital formats [2][5] - BlackRock is developing technology to facilitate the direct transfer of investment products into digital wallets, aiming to reduce settlement frictions and costs while enhancing accessibility [4][7] Group 1: Tokenization and Future Outlook - Fink envisions a future where mutual funds, private credit, money markets, and real-world assets are tokenized, allowing for near-instant settlement and built-in compliance [3][5] - The current landscape of ETFs serves as an entry point for mainstream investors, while the broader narrative revolves around the tokenization of nearly all asset types [5][7] Group 2: Market Implications - The anticipated shift towards tokenization is expected to improve trading efficiency through blockchain technology, resulting in lower fees and greater accessibility for investors [5][7] - There is a potential impact on Ethereum's role in asset tokenization if BlackRock and other institutions utilize their own platforms, which could alter the dynamics of the Ethereum market [8]

Wall Street investors are dumping shares in some of the world’s largest money managers on fears that their $3tn (£2.2tn) push into lending is heading for disaster. Shares in Apollo, Blackstone, KKR and Ares have fallen on average by more than 10pc over the last month, even as the wider US stock market has broken new records. Wall Street’s S&P 500 has climbed 3.4pc over the same period. The benchmark US stock index has gained more than 15pc so far this year amid excitement surrounding artificial intelligen ...

Core Insights - David A. Johnson is the founder and principal of Endurance Capital Management, specializing in various investment vehicles including stocks, bonds, options, ETFs, REITs, real estate, closed-end funds, hedge funds, and private credit [1] Group 1 - David A. Johnson has over 30 years of experience in investing and holds a Master of Science (MS) Degree in Finance with a concentration in Investment Analysis from Boston University [1] - He also possesses a Certificate in Financial Planning and an MBA from Fordham University [1]

President Trump’s recent executive order on alternative assets and 401(k)-style retirement plans has drawn fresh attention to the rapid growth of private markets, including private equity, credit, real estate and infrastructure. We cannot fully understand this growth, or its impact on global finance, without considering how the shift to private assets has intersected with other key investment trends — most notably, the expansion of the wealth-management industry. For perspective: Global assets under mana ...

Core Insights - Private credit is becoming more accessible to retail investors through vehicles like ETFs, with the introduction of the Simplify VettaFi Private Credit Strategy ETF (PCR) [1][6] Group 1: Private Credit Overview - Private credit offers elevated yields and strong lender protections, providing a diversification opportunity beyond core fixed income for retail investors [2] - The main challenge for ETFs accessing private credit is the SEC's 15% limit on illiquid investments, which most private credit falls under [3] Group 2: Investment Vehicles - ETFs can gain indirect exposure to private credit by holding publicly traded alternative asset managers like Blackstone, KKR, and Ares Management, which generate revenue from private credit strategies [3] - The State Street/Apollo structure allows ETFs to include private credit alongside public credit while adhering to liquidity rules [4] Group 3: Simplify VettaFi Private Credit Strategy ETF (PCR) - PCR is an actively managed ETF that seeks income and capital appreciation by providing exposure to publicly traded BDCs and CEFs that hold over 50% of their portfolios in private credit [6] - The ETF employs a proprietary credit hedging strategy using total return swaps to manage credit risk [6][10] Group 4: Advantages of ETFs - PCR offers daily portfolio transparency, in-kind creation/redemption, and better tax efficiency compared to CEFs and BDCs, which can trade at premiums or discounts to NAV [9] - The expense ratio of PCR is 76 basis points, which is lower than many traditional ETFs of CEFs that have fees ranging from 200 to 300 basis points [10] Group 5: Market Trends - The growth in the market is leaning towards ETFs, making it easier for investors to access private credit through a familiar structure [8]

Core Insights - T. Rowe Price Group (TROW) and Apollo Global Management (APO) are prominent players in the asset management industry, each with distinct strengths and focuses [1][20] - Apollo emphasizes private equity and alternative assets, while T. Rowe Price specializes in mutual funds and active management of equity and fixed income [1] Apollo Global Management (APO) - Apollo's diversified business model supports sustainable earnings, with a compound annual growth rate (CAGR) of 7.8% in assets under management (AUM) from 2021 to 2024, driven by retirement services and new financing [3] - The company expects its total AUM to reach nearly $1.5 trillion by 2029, primarily through scaling its private equity business [3][9] - Recent acquisitions, such as Bridge Investment Group Holdings, and partnerships with Mubadala and Citigroup enhance Apollo's capabilities and growth potential [4] - Apollo's revenues grew at a CAGR of 63.7% from 2021 to 2024, although growth moderated in the first half of 2025 [5] - The Zacks Consensus Estimate projects a year-over-year earnings increase of 4.7% for 2025 and 19.3% for 2026, with upward revisions in estimates over the past 60 days [10] T. Rowe Price Group (TROW) - T. Rowe Price's AUM experienced a CAGR of 2.3% from 2020 to 2024, supported by market appreciation and strength in multi-asset and fixed income [6] - The company has formed strategic alliances, including a partnership with Goldman Sachs to enhance access to private markets and an acquisition of Retiree for retirement income planning [7] - T. Rowe Price's net revenues grew at a CAGR of 3.4% over the past four years, continuing into the first half of 2025 [8] - The Zacks Consensus Estimate indicates a year-over-year earnings decline of 1.6% for 2025, followed by a 4.9% increase in 2026, with upward revisions in estimates [13] Comparative Performance - Over the past year, Apollo outperformed the industry with a stock gain of 17.3%, while T. Rowe Price only rose 0.5% [15] - Apollo trades at a forward price-to-earnings (P/E) multiple of 16.3X, while T. Rowe Price trades at 11X, both below the industry average of 17.45X [17] - Both companies have increased dividends five times in the past five years, with Apollo's yield at 1.5% and T. Rowe Price's at 4.8% [19] Investment Outlook - Apollo is positioned for greater upside potential due to its diversified and rapidly growing alternative asset platform, aggressive expansion, and strong earnings growth trajectory [20] - T. Rowe Price offers steady growth and high dividend yield but has a more conservative approach, limiting its upside compared to Apollo [21]

Core Insights - The private credit landscape is evolving, demonstrating adaptability amid economic challenges, with a notable shift from traditional lending to private credit as a primary financing mechanism for middle-market companies [1][2] Group 1: Market Dynamics - Direct lenders are increasingly stepping in where banks are unable to provide financing, particularly due to macroeconomic uncertainties and tariff policies [2][4] - The private credit sector is experiencing a resurgence in deal activity, particularly in refinancings and growth financings tailored to middle-market needs [5][12] Group 2: Notable Transactions - ABC Technologies secured a $2.3 billion loan package to refinance existing syndicated debt, consisting of a $1.6 billion senior term loan and a $675 million junior tranche [3] - Sapiens International Corporation locked in a $1.145 billion debt stack to support Advent International's $2.5 billion buyout, highlighting private credit's role in leveraged buyouts [7][8] - Liquid Tech Solutions initiated an $807.5 million term loan B to replace prior private credit arrangements, indicating ongoing refinancing activity in the sector [5] Group 3: Financial Metrics - Middle-market private credit issuance increased by 12% week-over-week, reaching $4.2 billion across 15 deals, reflecting a robust demand for private credit solutions [12] - Leverage multiples averaged 5.2x EBITDA, down from 5.8x in the previous quarter, indicating a cautious approach from lenders [13] - Spreads remained steady at 650-750 basis points over SOFR, with 70% of volume in unitranche structures, which are preferred for their speed in financing sub-$1 billion borrowers [13] Group 4: Future Outlook - The thawing of tariff effects could potentially unlock $50 billion in stalled syndications, suggesting a positive outlook for the private credit market [14] - With $1.5 trillion in dry powder, direct lenders are well-positioned to capture additional market share, offering solutions that traditional banks may not be able to match [14]

Private credit's effort to finance investment-grade companies is going to come down to its partnerships with banks, according to Apollo Global Management President Jim Zelter. "The future of IG private credit is really in partnership with the banks no doubt about it," Zelter said in an interview on "The Pulse" with Francine Lacqua. Zelter also discussed opportunities in Europe, as well as the impact of AI. ...