Concerns surrounding private credit have negatively impacted firms in that sector, as evidenced by significant actions from companies like Blue Owl Capital and BlackRock. Recently, Blue Owl halted redemptions in a fund holding billions in private loans, leading to plummeting shares. Similarly, BlackRock limited withdrawals from its $26-billion HPS Corporate Lending Fund and marked down a loan from full value to zero within months, causing significant declines in related funds.
In contrast, closed-end funds (CEFs) are viewed positively by income investors, particularly as their holdings offer more transparency compared to private credit. Notably, the Nuveen Core Plus Impact Fund (NPCT) currently yields 11.6% and trades at an 8.1% discount to its net asset value (NAV), highlighting its attractiveness amid market volatility. As private-credit concerns escalate, investors might increasingly shift toward these high-yield CEFs, which also provide monthly dividends and clearer asset valuations.
