Bloomberg Surveillance Private Credit Stress Test as Market Carries On
May 13, 2026
Ben McMillan, CIO at IDX Advisors, offers market color on AI-driven rallies, gamma flows, dispersion and hedging approaches. Randy Schwimmer, Vice Chair at Churchill Asset Management, explains private credit liquidity, illiquidity premia and why middle-market lending can steady portfolios. They discuss private credit stress testing, who benefits from the market, and risks from rapid, option-driven moves.
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Illiquidity Is The Stability Engine In Private Credit
- Private credit offers stability by trading on company fundamentals rather than headline-driven price moves.
- Randy Schwimmer contrasts $70tn public equity liquidity with ~$2tn private credit, arguing illiquidity delivers a steadier illiquidity premium of ~100–300 bps.
Read The Operating Instructions Before Buying Private Credit
- Read private credit offering documents: investors should expect limited trading and built-in illiquidity.
- Schwimmer warns firms promising high liquidity create a collision with true middle‑market loans that simply do not trade.
Private Credit Problems Look Contained Not Systemic
- Media and institutions are shifting tone: private credit issues appear isolated, not systemic.
- Schwimmer calls this a calming effect in middle‑market portfolios with broad diversification across ~660 investments.