Private Debt: Pricing Middle Market Loans

Stephen Nesbitt provides his observations on Public vs. Private Loan Pricing.
Overall, there is a strong similarity in private-public loan pricing. The average 3% historical public discount to private pricing can largely be explained by "bid" pricing of public loans in the index. Takeaway: the pricing of private middle market loans, represented by the Cliffwater Direct Lending Index, is consistent with public loan pricing represented by the index.
Further reading on Private Debt: www.cliffwater...
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Steve is Chief Executive Officer and Chief Investment Officer of Cliffwater and is primarily responsible for the day-to-day management of Cliffwater Corporate Lending Fund (CCLFX) and the Cliffwater Enhanced Lending Fund (CELFX), an SEC registered credit interval fund focused on the US corporate middle market.
Steve is recognized for a broad range of investment research. His papers have appeared in the Financial Analysts Journal, The Journal of Portfolio Management, The Journal of Applied Corporate Finance, and The Journal of Alternative Investments. His private debt research led to the creation of the Cliffwater BDC Index, measuring historical BDC performance, and the Cliffwater Direct Lending Index, measuring historical performance for direct middle market loans. Steve authored the book, Private Debt: Opportunities in Corporate Direct Lending, Wiley Finance (2019) which provides the analytical and empirical underpinnings of the private debt market.
This is not intended as a recommendation to invest in any particular asset class or strategy or as a promise of future performance. References to future returns are not promises or even estimates of actual returns a client portfolio may achieve.
Statements that are nonfactual in nature, including opinions, projections and estimates, assume certain economic conditions and industry developments and constitute only current opinions that are subject to change without notice. The opinions, projections and estimates, assume certain economic conditions and industry developments and constitute only current opinions that are subject to change without notice. Unless otherwise indicated, dates indicated by the name of a month and a year are end of month.