Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Are listed equity valuations stretched? The case for rotation into private credit

by Peter Szekely. Peter is a founding member of TCP and sits on TCP’s board, investment committee and audit, risk and compliance committee.

  • Australian and US equity markets have risen to all-time highs in 2025 despite ongoing global economic, trade and geopolitical uncertainty. However, many market commentators note that this strength has been accompanied by a growing disconnect between valuations and underlying company fundamentals, with participants increasingly cautious that share prices appear stretched.
  • Investors should remain cautious of the risks in being overweight to listed equities in these uncertain times and diversify their portfolios into other asset classes with downside protections.
  • Private credit loans to mid-market corporates offer attractive risk-adjusted returns while being relatively uncorrelated to the volatility of listed equities. 

Download the full paper

  •   22 October 2025
  •      
  •   

 

Leave a Comment:

banner

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.