The private credit asset class has emerged as an attractive alternative for institutional investors seeking yield, diversification and low volatility.

Ask a group of institutional investors for a definition of private credit, and you might receive several different answers. Among the fastest-growing alternative asset classes – capital under management has tripled since December 2007 to $638 billion in 2017, according to industry data provider Preqin – the term “private credit” encompasses a wide spectrum of strategies and structures ranging from small direct lending transactions with lower middle-market companies to large-scale mezzanine financing alongside private equity…