UNDERSTANDING THE RISK
Structured properly, private debt can provide a much greater safe haven than is typically understood. For instance, Old Hill’s transactions typically carry floating coupon rates and floors to protect against rising interest rates, while strong collateral coverage and proper deal structure address a wide variety of other transaction-specific risks. Returns associated with private debt do not typically move in tandem with other assets, such as stocks, private equity, or public bonds, in response to changing economic and market conditions. For the investor, these characteristics can increase portfolio diversification and reduce volatility.