12 October 2026
Private credit markets remain under pressure despite a rebound in alternative asset management stocks. During the week, Blue Owl and Apollo gained 4.5% and 4.1% respectively, while the VanEck BDC Income ETF and Virtus Private Credit fell by approximately 2% each. Meanwhile, the Senior Loan ETF remained relatively stable, suggesting that weakness has been more pronounced among listed private credit funds than in the broader leveraged loan market.
This divergence suggests that investors are becoming more willing to buy asset management shares but remain cautious about direct lending exposures. Concerns about loan valuations, liquidity and dividend sustainability have not disappeared. The recovery in software shares is encouraging, particularly given private credit’s exposure to the sector, but it has yet to restore confidence in BDCs.
Our assessment remains cautious rather than alarmist. The evidence points to continued repricing and selective stress, not a confirmed systemic credit crisis. A sustained recovery in BDC prices, supported by improving corporate credit spreads, would provide stronger evidence that conditions are stabilising.
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