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In a recent episode of LevFin Insights, Ashwin Krishnan, Head of Morgan Stanley North America Private Credit, discusses the evolution of private credit beyond traditional direct lending and the growing role of opportunistic credit in today's market. He explains how companies and private equity sponsors are increasingly seeking customized financing solutions to address challenges, including longer hold periods, higher interest rates and ongoing market uncertainty. He also examines the rise of hybrid capital structures, the expanding opportunity set among non-sponsored companies and the long-term outlook for private credit, emphasizing Morgan Stanley Investment Management’s solutions-oriented approach.
“Private credit does encompass a number of strategies, which increasingly are becoming more relevant given the market and geopolitical backdrop, and really the capital needs that companies have through their life cycles.”
Risk Considerations
Alternative investments are speculative and include a high degree of risk. Investors could lose all or a substantial amount of their investment. Alternative investments are suitable only for long-term investors willing to forego liquidity and put capital at risk for an indefinite period of time. Alternative investments are typically highly illiquid—there is no secondary market for private funds, and there may be restrictions on redemptions or assigning or otherwise transferring investments into private funds.
Alternative investment funds often engage in leverage and other speculative practices that may increase volatility and risk of loss. Alternative investments typically have higher fees and expenses than other investment vehicles, and such fees and expenses will lower returns achieved by investors.
Alternative investment funds are often unregulated, are not subject to the same regulatory requirements as mutual funds, and are not required to provide periodic pricing or valuation information to investors. The investment strategies described may not be suitable for your specific circumstances.
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