Goldman’s $15.7B Credit Fund Caps 4.999% Redemptions; Tech Valuations Dip Below Market
Goldman’s $15.7B private credit fund met just 4.999% Q1 redemptions, far below industry limits, enabling it to launch a $10B direct lending vehicle to exploit easing competition and wider spreads. Goldman strategists note technology valuations have dropped below aggregate market levels despite robust earnings and returns, creating buying opportunities.
1. Private Credit Fund Q1 Redemptions
Goldman Sachs Private Credit Corp. reported Q1 redemptions of just 4.999% on its $15.7 billion non-traded fund, staying within the 5% cap that forced peers to curb outflows. The fund’s reliance on institutional investors, rather than retail, helped it avoid the broader exodus seen across the $1.8 trillion private credit market.
2. Direct Lending Fund Launch and Market Dislocations
Building on this resilience, Goldman is raising a $10 billion direct lending fund to capitalize on reduced competition and wider spreads in private credit. Managers highlight that as retail investors retreat, stronger covenants and pricing tilt the balance in favor of lenders, though improvements in portfolio metrics may take time to materialize.
3. Tech Valuations Present Buying Opportunities
Goldman Sachs strategists led by Peter Oppenheimer argue that technology sector valuations have fallen below those of the global aggregate market despite sustained revenue growth, strong earnings revisions and high return on equity. They contend that lower sensitivity to economic growth shocks and prior underperformance now create attractive entry points for investors.