Goldman Sachs: Investors under-allocated to private credit

Investors believe that they are under allocated to private credit, according to the results of a new private markets survey from Goldman Sachs.

The survey of asset managers, private pension firms, insurers, endowments and public pensions also found that GPs are increasingly looking at secondaries and co-investments in the private credit space.

Almost half of the LPs surveyed said that they are now allocating to secondaries and co-investment strategies, which Goldman Sachs described as a “pretty meaningful increase” compared to last year.

Read more: Moody’s: Private credit to hit $3tn by 2028

Meanwhile, most LPs told the investment house that they wanted to invest even more into private credit.

Approximately 40 per cent of LPs said that they planned to increase their capital deployment, with just 21 per cent opting to either reduce or stop deployment.

Read more: Secondary market deals hit record high of $69bn in H1

Earlier this month, a Moody’s report predicted that the private credit market is set to grow to $3tn (£2.3tn) by 2028 as the industry rapidly evolves beyond direct lending.

Moody’s added that the broader asset-backed finance market could increase to as much as $40tn as a wider range of investors seeks out the higher yields and portfolio diversification that private credit has to offer.

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