Private credit fund managers are reportedly reducing their exposure to software amid market turmoil.
This is according to industry analysis published Sunday (March 29) by The Wall Street Journal (WSJ).
The news outlet examined four large funds that were marketed to investors through… Apollo Global Management, Ares Management, Blackstone and Capital of the blue owlIt found that these funds have greater exposure to the software sector than their filings indicate.
The report indicates that investors are concerned about this industry Exposure to software space It helped drive record withdrawals from private credit funds during the first quarter of 2026. Fund managers argue that AI will impact every software company in different ways, and that companies will adapt or even benefit.
On average, the report said, the four funds listed about 19% of their investments as software-related, while the Wall Street Journal found that this number was actually about 25%. The Wall Street Journal cites a recent report by Barclays analysts on the private credit market indicating that there is no uniform way for private credit funds to classify their exposure to various industries.
“This ‘massage’ of the sector is worrying the investor community and makes it difficult to assess degrees of true diversification across funds,” analysts said.
We would love to be yours Favorite source of news.
Please add us to your favorite sources list so our news, statements and interviews appear in your feed. Thanks!
Advertisement: Scroll to continue
The Wall Street Journal added that private credit funds stress that software companies serving other sectors should be reported as part of that sector because they depend on those industries. This approach began before the current trend Uncomfortable about software.
The report also cites recent analysis from Morgan Stanley Which found that software companies in private credit portfolios have, on average, more debt relative to their profits than companies in any other industry.
“If you look at private credit deals that have gone awry, most of them have a software component,” says Alex Chalov, chief investment officer at Alex Chalov. Bernstein Private Wealth Managementhe told the Wall Street Journal.
In other special credit news, PYMNTS wrote last week about the industry shifting to a phase where “access to financing depends on how loans are financed after they are originated,” with market signals showing “capital flowing into structured credit even as liquidity pressures emerge in fund-based lending.”
The report added: “In short, private credit is no longer a contest about who can originate loans. Rather, it is a test of who can move them.”
Recent developments have highlighted this division. For example, Stone Ridge Asset Management He told investors he would just meet 11% of refund requests In one of its private credit funds after an increase in withdrawal requests.
At the same time, Bank of America Customers have been warned about Private credit exposure By presenting a selection of European financial stocks against companies “most exposed to private credit shocks”, citing potential downside risks.
