Presentation to Vermont Pension Investment Committee
Comparing Investment Cash Flow Profiles
The typical Alternative Credit investment has a cash flow profile that is very different from typical private equity
or corporate debt investments
We believe such a profile provides a number of risk mitigation benefits, including:
No reliance on a realization event for a return of capital
High volumes of cash flows can quickly reduce risk exposure
Relatively short investment duration
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Private Equity
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8
Typically receives little to no cash
flow until a realization event
(e.g., the sale or IPO of
the company).
Visualizing Cash Flows
Corporate Debt
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8
Typically receives only interest
coupons until a realization event
(e.g., the refinancing of the debt or
sale of the company).
Typical cash flows are presented for illustrative purposes only. Actual cash flows may vary materially from those presented above.
Confidential - Not for Publication or Distribution
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Alternative Credit
Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8
Typically sees a high volume of
front-loaded cash flows from the
underlying assets. It does not rely
on a realization event.
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