Private Credit Strategies
Free CAIA Level I lesson in Private Credit. 45 min read, ~6,784 words.
Private credit grew because post-GFC bank regulation (Basel III, Dodd-Frank) created a lending gap. The market expanded from $200B in 2007 to ~$1.6T in 2024. Direct lending = senior secured, first lien, floating rate; mezzanine = subordinated, higher yield, often includes equity kickers and may add PIK, step-up, or profit-participation...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- strategies
- credit risk bankruptcy
- bonds loans
- direct lending
- mezzanine
- advanced mezzanine
- venture debt
- distressed debt
- asset based lending
- abs risks
- abs
- mortgage overview
- residential mortgages
- mortgage reit returns
- cat bonds
- cat trigger types
- cat valuation
- longevity mortality
- life settlements
- viatical
- structuring overview
- cmos
- cdo intro
- cdo variations
- balance sheet arbitrage cdo
- arbitrage cdo mechanics
- cash flow vs market value cdo
- other cdos
- cdo risks
- credit enhancements
- credit deriv markets
- cds
- cds index
- other credit derivs
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