Until recently, private credit – a purportedly new asset class – has been one of Wall Street’s fastest growing investment products. Though supposedly a new asset class, we suspect there is less to private credit than meets the eye.
Equity markets have become increasingly concentrated in recent years. The implication is that investors in a global equity index are no longer well diversified.
Equity markets are currently trading at elevated valuations. The implication for long-term investors is that future returns are likely to be depressed, and risks heightened.
Despite a bout of market weakness earlier this year, US equity valuations have remained at historically elevated levels throughout. Such valuations present a significant risk for long-term investors.
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