Private credit funds were built to be held to maturity. Investors accepted that condition in exchange for a yield premium that exists precisely because the money cannot be got back early.
A growing number of them are getting it back early anyway. Credit secondaries volume roughly doubled from about $6bn in 2023 to about $11bn in 2024, and is expected to top $18bn once 2025 is counted.
Which creates something this asset class has never really had: a price somebody was willing to pay.
Why this is different from every other valuation in private credit
In a private credit fund, the value of a loan is a mark. The manager determines it, using models and judgement and comparables, and reports it to investors who cannot independently verify it. This paper has written before that a mark is an opinion until somebody has to sell, and yesterday that a borrower amended into paying interest in kind disappears from the statistic that counts non-payers while the principal owed grows.
Every one of those valuations shares a property: the person producing it is the person whose fees, track record and next fundraise depend on it. That does not make marks dishonest. It makes them unverified.
A secondary transaction is the exception. A buyer with no stake in the manager's reputation looks at the same portfolio and names a number they will actually pay. It is the only point in the life of these funds where an outsider's valuation is tested by money.
And the number is high
Quality credit stakes are changing hands at about 95 to 99 percent of net asset value. Equity secondaries, by contrast, price at roughly 75 to 90 percent, and the wider LP secondaries market finished 2025 near 87 percent — buyout around 92, venture and growth around 78.
There is a good structural reason credit prices tighter. A credit fund interest is a claim on a stream of interest payments, typically distributing 8 to 12 percent a year. The buyer is purchasing cash flow that arrives on a schedule, not an outcome contingent on somebody selling a company in 2029. Less uncertainty, less discount. That is ordinary finance and it is not suspicious.
So the first reading of 97 cents on the dollar is the reassuring one: private credit marks are broadly right, and an independent buyer confirms them.
The second reading
Secondary prices describe the stakes that were offered.
A seller chooses whether to test the market. An LP holding a diversified position in a fund performing roughly as promised can sell near par and will, because they want liquidity for reasons of their own — a denominator problem, a change of allocation, a need for cash.
An LP holding a fund where a meaningful share of income is now paid in kind, where non-accruals have been climbing, and where the manager has been amending documentation to keep borrowers current, faces a different calculation. Testing that position means discovering what it is worth, in public, in a transaction that other investors in the same fund will hear about. The rational move is not to sell.
Which means the 95-to-99 range is a statement about the traded subset, and the traded subset is selected on the very quality being measured. That is not a flaw in the secondaries market. It is a limit on what its prices can be used to conclude, and the conclusion currently being drawn — that pricing near par validates the asset class — runs straight past it.
The continuation vehicle problem
One figure in the data deserves separate attention. Single-asset continuation vehicles were 62 percent of GP-led secondaries volume in the first half of 2026, at an average discount to net asset value of 2.9 percent.
A continuation vehicle is a manager selling an asset out of one fund it runs into another fund it runs. The manager is on both sides. The price is negotiated with incoming investors, but the seller and the buyer share a sponsor, and the sponsor sets the mark being transacted at.
A 2.9 percent discount in that structure is not the same kind of evidence as a 5 percent discount in an arm's-length LP sale. It is closer to the mark, restated as a transaction. Counting it as price discovery makes the market look more tested than it is.
What the illiquidity premium was for
There is a broader point in the volume growth, separate from the pricing.
Investors were paid extra to give up liquidity. A secondary sale is an investor buying that liquidity back, and the discount — even a small one — is the price. When the volume of that trade doubles in a year and doubles again, LPs are collectively revealing that the premium they accepted was less than the option they gave up.
That is a repricing of the whole bargain, and it will show up in fund terms before it shows up in returns.
What would make it real evidence
Not average pricing. Publish the ratio of stakes offered to stakes sold, and the pricing spread between the best and worst quartile of transactions.
If almost everything offered trades near par, the marks are probably sound. If a widening share of offered positions fails to clear, or clears far below the average, the tight headline discount is a survivorship figure — and the useful information will be sitting in the trades that did not happen, which is where it has been all along.
The growth in credit secondaries volume from about $6bn in 2023 to about $11bn in 2024 and an expectation of more than $18bn for 2025; the pricing of quality credit stakes at roughly 95 to 99 percent of net asset value against roughly 75 to 90 percent for equity secondaries; the explanation that credit fund interests pay regular income of typically 8 to 12 percent annually rather than depending on an exit event; the average LP portfolio pricing near 87 percent of NAV at the end of 2025 with buyout around 92 percent and venture and growth around 78 percent; and the figure that single-asset continuation vehicles were 62 percent of GP-led secondaries volume in the first half of 2026 at an average 2.9 percent discount to NAV are as reported by The Middle Market and secondaries market analyses published in 2026. The PIK and non-accrual figures referred to here are from this publication's reporting of 3 September 2026. The analysis is our own.
Topics marketsprivate creditvaluationliquidity
