Private Credit Volatility Is Buying Opportunity for US Pensions

US state pensions and investment funds are betting they can outlast the turmoil in private credit, adding to their stakes in the $1.8 trillion market.

Prominent buyers include the Arkansas teachers’ retirement fund, which increased its position this month, while New Mexico’s sovereign wealth fund and Virginia’s pension added to their stakes in March.

While high-profile defaults and worries over loans to software companies have sparked an exodus of individual investors from private credit, pensions tend to operate with a far longer horizon, giving them greater capacity to withstand market gyrations. Retirement fund officials and consultants also say there’s ...