Pengana Capital is set to launch a new Separately Managed Account (SMA) Fund on October 15, 2024, aimed at non-institutional Australian investors seeking private credit opportunities. Nehemiah Richardson, CEO of Pengana Credit, emphasized the growing demand for global private credit, indicating a shift in investment strategies among retail investors. This SMA Fund is notable for being the only diversified global private credit product available in the Australian SMA market, designed to provide retail investors with access to diversification and returns comparable to those enjoyed by institutional investors. [cae3f976]
The SMA Fund will complement Pengana's existing offerings, which include partnerships with Mercer and other funds such as the Pengana Global Private Credit Trust (PCX). The distinction between global private credit and local Australian private credit is significant, particularly in terms of risk appetite and investment quality. This initiative reflects a broader trend in the investment landscape where private lending is becoming increasingly attractive amid tightening traditional banking avenues. [cae3f976]
In the context of the current economic climate, affluent individuals in Hong Kong and mainland China have also been borrowing against stocks due to liquidity challenges. The private credit market in Asia-Pacific has seen substantial growth, reaching at least US$124 billion in 2023. Gordon Crosbie-Walsh, Asia CEO at Equities First Holdings, noted that real estate developers are particularly affected by these liquidity issues, leading to a surge in demand for private credit solutions. [7265a8f9]
Family offices in the Asia-Pacific region have increased their equity allocations to 40% in Q2 2024, indicating a strategic pivot in investment approaches. Additionally, HSBC has reported a resurgence in lending against marketable securities, further illustrating the trend of borrowing against stocks. Federal Reserve Chairman Jerome Powell's hints at imminent rate reductions could also influence borrowing costs and investment strategies moving forward. [7265a8f9]
As traditional banks remain cautious, the reliance on private credit is likely to grow, reshaping the financial strategies of wealthy investors in the region. The investment landscape is evolving, with private lending becoming a crucial avenue for ultra-rich individuals seeking liquidity, while new offerings like Pengana's SMA Fund aim to democratize access to private credit for retail investors. [7265a8f9]