Signs of trouble

Increased investment in distressed debt funds could be signs of a troublesome economic environment ahead.

Observers of the macro-economic climate are beginning to see signs of promise for distressed debt investors as stock market volatility in the early months of 2018 combines with higher inflation and interest rates to put increasing pressure on credit profiles.

Did investors see the writing on the wall in 2017?

Fundraising data from PDI suggests they did, with distressed debt fundraising hitting a peak of more than $61 billion, easily surpassing the previous record high of nearly $42 billion in 2012.