As valuations continue to reach record highs, investors should be cautious of concentrating too much of their portfolio in listed equities, according to Tanarra Credit Partners (TCP) managing partner, Peter Szekely.
He says investors should consider corporate private credit, which offers structural features that help insulate portfolios from market volatility.
“With equity valuations stretched, corporate private credit offers a compelling alternative investment opportunity. It provides investors with active management and an underwriting discipline supported by structural protections and rigorous selection standards, unlike passive exposure to index-heavy equities.”
He says listed equity P/E ratios remain at all-time highs, prompting concerns about whether these valuations are sustainable.
“As of September 2025, the S&P 500 was trading at a trailing price-to-earnings ratio of 27.29, well above its rolling five-year average of 22.17 and its twenty-year average of 16.13. The MSCI World was trading at a P/E ratio of 23.94, also above its five-year average of 20.41.”
