VRC’s Rule 2a-5 Resource Guide provides the details fund managers and fund boards need to come into compliance with the SEC’s new regulations to fair value portfolio securities.
How are market participants reacting to positive vaccination rates, economic optimism, company prospects and floating rate security demand?
In Q4 2020, market participants noted improving comfort with company and industry fundamentals, outlooks, and the ability to weather a second wave of the virus.
In Q3 2020, secondary equity and credit markets rebounded, primary equity and levered finance markets reopened, and the price of risk declined.
As we head into Q4 2020, the new normal in private capital markets has fully set in, generally defined by prudence and caution, albeit a work in progress.
Considering the virus’ material impact on specific industries, we’ve seen a greater emphasis on secondary industry-specific loan indexes when controlling for credit risk.
The only comparable event to the spread of the virus for modern private capital markets is the Great Recession, but there are some key differences this time.
While secondary indexes are good barometers of investor sentiment and market trends, the levels reflected may not fully reflect company fundamentals and deal pricing, reflecting the new normal in a COVID-19 economic environment.
Market participants embrace best practice guidance, adjust policies accordingly. But the AICPA’s best practices are not without challenges and intricacies for the private debt and private credit professional.
The latest editions of the DACH Capital Market Study and the European Capital Market Study are now available from our international affiliate partner, ValueTrust.