'Cockroach' scare: Private credit stocks lose footing in 2025

Investment giants with a private credit footprint are set to end 2025 in the red after the twin bankruptcies of auto parts maker First Brands and subprime lender Tricolor in the fall rattled investors

Blackstone BX.N, the world's largest alternative asset manager, down 10.2% YTD, while Apollo Global APO.N and Blue Owl OWL.N have lost 11.6% and 35.6%, respectively

Ares Management ARES.N off 7.8% and KKR KKR.N down 13% in 2025, as of previous close

Worries about the sector’s health were exacerbated after JPMorgan Chase JPM.N CEO Jamie Dimon warned more stress could be lurking

"When you see one cockroach, there are probably more, and so everyone should be forewarned of this one," Wall Street’s most celebrated banker said in October

Though most of these companies have said they have no exposure to the collapsed auto sector firms, investors have remained on edge amid forecasts that the sector could see more credit stress in 2026

Private credit defaults are set to edge lower in 2026 as rates drop but the red-hot sector remains among the most fragile parts of the U.S. credit market, strategists at BofA Global Research said earlier this month

Private equity and credit stocks underperform markets in 2025; equities benchmark S&P 500 .SPX up 17.3% YTD

Elsewhere on Wall Street, S&P 500 Financials Index .SPSY up 14.2% in 2025, with large-cap banks set for a second straight year of blockbuster gains