ARDC - Word Of The Week: 'Capitulation'
2025-04-15 04:23:33 ET
Summary
- Concerns about "capitulation" seem more appropriate to equity than to credit investing, given the wider swings - up and down - inherent in stocks.
- Credit investing has more of a floor under the risk we are taking, even after you factor in the likelihood of occasional defaults.
- Fortunately, we have lots of data through economic cycles and market crashes of all types, to help us model credit investing outcomes.
- Lots of risks in both markets, but I continue to believe the downside risks in equity outweigh those in corporate credit.
- The corporate credit funds we've selected include senior loan funds, high-yield bonds, CLOs, and the current favorite, "Private Credit."
Capitulation, Anyone?
As a writer, I've always been interested in language, so the past week or so has been interesting as I've been hearing and reading a word I seldom paid much attention to in the past: "capitulation." In fact, on Monday, as we are about to go to press, the Wall Street Journal has just published a new article on it....
Word Of The Week: 'Capitulation'