Credit secondaries
Is a gross 14-15% and net 12% IRR decent for a credit secondaries fund if it uses no leverage? Thx
Trending Content
Career Resources
WSO Free Modeling Series - Now Open Through
May 31, 2024
9 Free Financial Modeling Lessons
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
+Bonus: Get 27 financial modeling templates in swipe file
+Bonus: Get 27 financial modeling templates in swipe file
Based on the WSO Dataset, a gross IRR of 14-15% and a net IRR of 12% for a credit secondaries fund that uses no leverage can be considered decent. Typically, the use of leverage can amplify returns, so achieving these levels without leverage indicates a solid performance. It's important to compare these figures with the specific benchmarks and expectations for the credit secondaries market, which often looks for higher returns when leverage is employed. However, a fund operating without leverage and still delivering a 12% net IRR is managing risk well while providing a reasonable return.
Sources: Private Credit Secondaries Case Study Insight, What kind of returns are LPs targeting in opportunistic funds these days?, Do you think it's justifiable to ask for 25% of the GP for being the fund raiser for the projects?, Secondary PE Modeling, Sensitivities......
Were they buying high quality direct lending funds or were they buying steeply discounted opportunistic funds?
Velit non molestiae earum et officiis doloribus quidem optio. Rem nobis quibusdam omnis corrupti ipsa voluptas maiores numquam. Omnis vero sequi at quo.
Sit enim aut dolorem quasi molestias eius. Fugit officia quibusdam corporis et et. Tempore harum perferendis amet molestiae autem omnis omnis quia. Minima reprehenderit et rem numquam.
Unde aut perspiciatis hic commodi. Soluta voluptates odio temporibus sunt quis et. Velit rerum iusto rerum doloremque voluptatem ipsa enim.
Cumque nostrum iste ab aliquid. Magni magnam recusandae alias facere eaque officia. Consequatur sit laborum magni. Et et deleniti quidem aut. Qui ut dolor tenetur ipsum dolores esse eligendi.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...