Key Takeaways
- • Fitch private credit default rates show Industrials and Consumer sectors each at 9.7%, the highest among the sectors cited in the post.
- • Healthcare providers default at 8.7%, while Software defaults at just 0.6%, the lowest figure referenced.
- • The post argues that concerns about AI disrupting software are not yet reflected in defaults, which are concentrated in other sectors.
- • The data as presented is a partial sector list, with intermediate sectors omitted from the post.
Summary
A post from the Substack account junkbondinvestor, citing Fitch data, presents private credit default rates by sector. Industrials and Consumer each show a 9.7% default rate, the highest figures in the excerpt, followed by Healthcare providers at 8.7%. The post elides several intermediate sectors with an ellipsis, so the full distribution is not shown. Software, by contrast, registers a default rate of 0.6%.
The author contrasts these figures with prevailing market concern that artificial intelligence could erode the value of software businesses. According to the post, defaults so far are concentrated outside software, with "everything else" driving the stress in private credit portfolios. The excerpt does not provide the time period, sample size, or methodology behind the Fitch figures, and those details should be verified against the original Fitch publication before being relied upon for allocation decisions.
The author contrasts these figures with prevailing market concern that artificial intelligence could erode the value of software businesses. According to the post, defaults so far are concentrated outside software, with "everything else" driving the stress in private credit portfolios. The excerpt does not provide the time period, sample size, or methodology behind the Fitch figures, and those details should be verified against the original Fitch publication before being relied upon for allocation decisions.
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