Nuveen

As AI-driven concentration risk reshapes direct lending, Nuveen's latest insights explore how institutional investors in Asia Pacific (Apac) are building genuine diversification across alternative credit – without accumulating hidden risk. The key is to create more resilient portfolios by moving beyond concentrated direct lending toward energy infrastructure credit and real estate debt.

There is a growing case for diversifying globally and across strategies with alternative credit, according to Nuveen.

The results from survey point to a growing risk-on sentiment among investors, with plans to expand into niche areas of private fixed income.

We consider how alternative credit has evolved, and what these asset classes can provide investors in uncertain times.

Alternative credit strategies such as direct lending, energy infrastructure credit, real estate debt, and collateralised loan obligations can provide shelter for portfolios during uncertain times.

Against the new macroeconomic backdrop, institutional investors are reassessing many of the well-established assumptions and practices that allowed their portfolios to flourish during the great moderation, says Nathan Shetty, CFA®, FRM, head of multi-asset at Nuveen.

The rest of this year should produce a dynamic market environment that will offer alternative credit investors many opportunities to access attractive returns while improving overall diversification levels, according to new research from Nuveen.

The rapid growth of private credit as an asset class in the US and Europe reflects attractive investment characteristics that could make it well-suited to address recent macro challenges, says Randy Schwimmer, senior managing director and co-head of senior lending at Churchill from Nuveen, and Mattis Poetter, co-chief investment officer of Arcmont from Nuveen.

Most asset classes offer opportunities to make an impact, but getting started can be daunting, explains Sarah Wilson, head of ESG integration at Nuveen.

Even as traditional fixed income offers more attractive rates, institutional investors continue to explore alternative credit, explains Randy Schwimmer, co-head of senior lending at Churchill, a Nuveen company.

Asset owners across Asia Pacific (APAC) are rethinking markets, reallocating portfolios and responsibly investing amid dramatic shifts in the macroeconomic and geopolitical landscape, according to Nuveen.

In an interview on the back of the launch of Nuveen’s 2022 EQuilibirum survey of global institutional investors, Nick Liolis, the chief investment officer at TIAA and Amy O’Brien, the global head of responsible investing at Nuveen speak about how insurance companies approach impact investing.