Video
How should investor think about risk in junior capital
Subordination does not often equate to higher risk.
Sponsor-backed junior credit has historically offered low volatility with strong risk-adjusted returns — driven by several key factors.
Subordination does not often equate to higher risk. The characteristics of junior capital that have driven this relationship between low risk and high return include structural protections such as covenants, equity subordination usually greater than 50% in terms of equity cushions relative to our junior capital’s position, and a focus on high-performing companies backed by leading private equity firms.
Speaker
Jason Strife
Head of Junior Capital & Private Equity Solutions
Churchill
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