Welcome to the October 27th update for PRIV and PRIV Accessories.
This is a weekly snapshot and update for the SPDR® SSGA IG Public & Private Credit ETF (PRIV) and State Street® Short Duration IG Public & Private Credit ETF (PRSD) along with some broader ETF commentary.
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This database uses the public holdings files from SSIM to generate insights and track product changes. The whole system was created with a combination of ChatGPT/Claude and my own limited knowledge.
PRIV traded 1.6mm shares! About ~$40mm of that was inbound flows with 1.3mm shares created on October 29th and 150,000 created on October 27th. I have a suspicion based on Friday’s trading (303,500 shares) that we’ll see another few hundred thousand added tomorrow morning. The holdings file actually indicated $194mm in assets while the NAV file only shows $189mm. Definitely a lag on their reporting for the umpteenth time.
More on the asset changes below!
PRSD has traded… 42 shares total since 10/15.
With the help of some intrepid friends with fancy jobs and terminal access I got the actual share counts. Well over half, 23 of 38 days, have had less than 100 share traded. I can’t tell if a single share per day is just the minimum display on Bloomberg. Yahoo shows no activity at all.
We had some pretty slow days initially with PRIV but this is getting a little ridiculous.
Asset Changes:
PRIV:
There are a lot for PRIV!
With substantial flows coming in, we have a lot of new assets and position up-sizing going on.
You may have seen my note on Friday about this:
Large flows for PRIV for the last few days. Another ~$50mm in the door taking them up to around ~$190mm.
More interestingly, they loaded up on one of their Apollo private assets (AP Chia Issuer LLC), just about doubling their position. The price change over the flow period (10/22-current) is pretty indicative that whatever price they’re getting is well below what their previous marks would indicate. They were not actively marking this position, simple accruing the coupon interest similar to about 80% of the current direct private asset exposure.
Looking at PRSD for a correlation, as it’s the only other product on Earth that has this asset in it, we can see that they hadn’t touched the mark on AP Chia Issuer LLC until yesterday when they marked the whole thing down 1.7%. This is on the back of both portfolios selling a small (.8% of total position in PRIV, 2.3% in AP Chia). The PRIV position has been marked down around 1.45% net of interest accrual as well. Very odd behavior, particularly for PRSD which hasn’t seen more than 2 shares trade in a day since October 15th.
See the attached pricing for the last 5 days, courtesy of my app. Free to use for all.
Now, to expand on this a bit.
We see on Friday that PRIV added a $500k position in HPS CORPORATE LENDING FUND 8.8 09/14/2028 which is also in PRSD. This fund has a much higher coupon and more shorter duration than the rest of the private assets, excluding NHPIF. It’s getting murkier to keep track of any estimated prices for these assets. There are a lot of baked in interest accruals and assumptions for each piece of each asset.
It IS interesting to me that we see dozens of different public positions getting shuffled around but the same private assets keep being tapped.
PRSD:
Obviously not nearly so many changes here.
This is a weird one. It looks like whomever was PM for the day on the 29th decided to take a punt on short-term trading.
They sold chunks of a bunch of IG credit and piled in (500k on 25m isn’t that small of a bet!) to a Fiserv bond.
If that trade was timed well, they may have nicked a solid yield for the next 6 months.
Pricing:
As we talked about before, there’s some indications that most of the up-sizing and new private asset positions are being bought at under whatever the current mark is on the asset. Does this show softness in the private credit market? I think generally you could say yes but there are a whole slew of mitigating factors to consider.
Macro:
First and foremost, I had an article (my first with a byline ever!) published.
I have more in store on this topic. I’m trying to approach it like I do in here as a retail investor and market watcher. I’m looking for any and all feedback on this as always, I know most of you are in the industry or adjacent to it so please chime in!
Blackrock’s private credit arm HPS (remember them from just up above? HPS CORPORATE LENDING FUND 8.8 09/14/2028 in both ETFs) wrote off a pretty big chunk of change after providing $150m in financing to basically nobody. Gotta love the due diligence these guys are putting in. You hate to see it!
I’m a little concerned about PRSD’s utter lack of volume. They have $25m in there, not $250-500k. I’ve sent more emails and have been left on read for months and months. Maybe one day I’ll get more answers but until then we can only soldier on!
Leave a comment/note/send me a message about my app and let me know what I can do better or just get rid of! No wrong answers.
