While investor attention in 2025 and early 2026 has been dominated by the momentum and volatility in precious metals such as gold and silver, another corner of the capital markets has been undergoing a quieter but equally important shift: private credit.
For years, low interest rates pushed capital toward private loans, where investors could earn higher spreads by accepting less liquidity and transparency. As that market expanded, leverage increased and structures grew more complex, setting the stage for stress once financial conditions tightened.
Stress in the space began to catch public attention when BlackRock TCP Capital Corp. (ticker: TCPC), a business development company, or BDC, reported a 19% write-down to its net asset value (NAV) in the final quarter of 2025. BDCs are publicly traded vehicles that lend primarily to middle-market companies and are often used by retail investors as a proxy for private credit.
In TCPC’s case, the write-down drew attention because the shares were already trading at a discount to NAV, often interpreted as a sign of declining investor confidence. Analysts pointed to elevated leverage within the portfolio as a key vulnerability. However, experts warn against extrapolating TCPC’s troubles to the entire BDC universe.
“It can be tempting to indict the entire asset class, but it is important to look at the underlying fundamentals,” says Christoper T. Getter, managing director, portfolio manager and emerging-market strategist at Simplify. “For example, paid-in-kind interest – which measures how much of a BDC’s investment income is borrowers making their interest payments with additional debt as opposed to paying it in cash – has remained below the 10% threshold generally considered a worrying level.”
Still, Wall Street has continued to push private credit exposure toward retail investors. Historically, private credit was accessed through illiquid structures such as interval funds, or evergreen funds, which are typically available only to accredited investors and limit redemptions.
However, under SEC Rule 22e-4, ETFs are permitted to hold up to 15% of their assets in illiquid investments, and some newer funds are using that allowance to directly own private credit instruments.
That raises important questions about how much liquidity and transparency investors can realistically expect during periods of market stress from newer private credit ETFs.
With those trade-offs in mind, here are seven of the best private credit ETFs to consider in 2026:
| ETF | Expense ratio* |
| VanEck BDC Income ETF (BIZD) | 12.86% |
| Simplify VettaFi Private Credit Strategy ETF (PCR) | 0.76% |
| BondBloxx Private Credit CLO ETF (PCMM) | 0.68% |
| Virtus Private Credit Strategy ETF (VPC) | 9.86% |
| WisdomTree Private Credit and Alternative Income Fund (HYIN) | 4.34% |
| SPDR SSGA IG Public & Private Credit ETF (PRIV) | 0.70% |
| State Street Short Duration IG Public & Private Credit ETF (PRSD) | 0.59% |
*Expense ratios for some private credit ETFs include acquired fund fees and expenses passed through from underlying holdings, which is why they appear higher than normal.
VanEck BDC Income ETF (BIZD)
“Recent market volatility has created more attractive relative valuations among publicly traded BDCs, where prices have adjusted lower versus other areas of high yield,” says Coulter Regal, product manager at VanEck. “Looking ahead, there is potential for greater dispersion across issuers and portfolios, with outcomes expected to be driven more by company- and loan-specific factors.”
Investors who are new to BDCs can prioritize diversification with an ETF like BIZD. “With a more than decade-long operating history and $1.6 billion in assets, BIZD is one of the more established ETFs in the category,” Regal says. This ETF tracks the MVIS US Business Development Companies Index, which emphasizes the larger, more well-capitalized BDCs. BIZD pays a 9.1% 30-day SEC yield with quarterly distributions.
Simplify VettaFi Private Credit Strategy ETF (PCR)
“PCR obtains its exposure through investment in an entire index composed of BDCs and close-ended funds engaged in private lending,” Getter explains. “The index-based approach also provides manager diversification, which we think is valuable given the significant dispersion of results among the index constituents and the difficulty of conducting due diligence in the space.”
PCR’s strategy also includes a credit hedging element, achieved by long and short trades via total return swaps. “Claims of private credit being a low-volatility asset class mask occasional significant drawdowns,” Getter explains. “Our proprietary ‘quality minus junk’ credit hedge seeks to provide some cushion during periods of market stress.” PCR currently offers a 12.7% distribution yield with monthly payouts.
BondBloxx Private Credit CLO ETF (PCMM)
“PCMM offers investors diversified exposure to loans of privately owned middle-market companies, one of the true growth engines of the U.S. economy,” says Tony Kelly, co-founder of BondBloxx. “It provides the transparency and liquidity of an ETF, and has a management fee that is 50% less than most interval funds.” After accounting for a 0.68% expense ratio, PCMM currently pays a 6.4% 30-day SEC yield.
PCMM’s private credit exposure comes through CLOs, which are pools of senior secured loans made to non-public companies. Unlike the collateralized debt obligations of the 2008 financial crisis, CLOs are not backed by subprime mortgages, and are structured with safeguards such as overcollateralization tests, interest coverage tests and active management of the underlying loan pool to protect investors.
Virtus Private Credit Strategy ETF (VPC)
VPC primarily holds BDCs and closed-end funds (CEF) by tracking the Indxx Private Credit Index. One important nuance is cost. VPC’s stated total expense ratio of 9.86% looks extreme, but that figure includes 9.11% of acquired fund fees and expenses passed through from the underlying BDCs and CEFs. The ETF’s base management fee is 0.75%. VPC’s 30-day SEC yield of 14.2% far exceeds that of diversified BDC ETFs such as BIZD.
TCPC is a top holding, at roughly 2.5%, alongside high-yield names like Prospect Capital Corp. (PSEC), which trades at a deep discount to an already-eroding NAV. Another notable holding is Oxford Lane Capital Corp. (OXLC), which invests in the equity tranches of CLOs, widely considered the highest yielding but riskiest slice of the capital structure because they absorb losses first.
WisdomTree Private Credit and Alternative Income Fund (HYIN)
HYIN tracks the Gapstow Private Credit and Alternative Income Index and, like VPC and PCR, it gains private credit exposure primarily through allocations to BDCs and CEFs. But unlike those peers, HYIN also holds mortgage real estate investment trusts, which generate income by borrowing short term to invest in longer-dated mortgage-backed securities, profiting from the interest rate spread and leverage.
Investors should be aware of similar fee dynamics seen across this category. HYIN’s stated total expense ratio of 4.34% includes 3.84% of acquired fund fees and expenses passed through from its underlying holdings, while the ETF’s own management fee is a more modest 0.5%. The fund currently pays a 12.1% 30-day SEC yield with monthly distributions, reflecting its higher-risk, higher-income profile.
SPDR SSGA IG Public & Private Credit ETF (PRIV)
True private credit exposure outside of BDCs and CEFs can be accessed through PRIV. This actively managed ETF is permitted to allocate roughly 10% to 35% of its portfolio to private credit instruments, though truly illiquid private loans outside of BDCs and CLOs remain capped by regulation at 15% of net assets. The remainder of the portfolio resembles an actively managed core-plus bond strategy.
Currently, PRIV holds 204 positions and carries an intermediate duration of 5.7 years, implying moderate sensitivity to interest rate movements. After accounting for a 0.7% expense ratio, the fund offers a 4.1% 30-day SEC yield. That yield is lower than many other private credit ETFs because direct private credit represents only a modest portion of the portfolio, with the bulk invested in traditional fixed income.
State Street Short Duration IG Public & Private Credit ETF (PRSD)
PRIV’s intermediate duration of 5.7 years means that, all else being equal, a 1% increase in interest rates could lead to roughly a 5.7% decline in net asset value, while a 1% rate cut could boost returns by a similar amount. Investors looking to reduce that interest rate sensitivity can instead consider PRIV’s shorter-maturity counterpart, PRSD, which has an average duration of just two years.
Like PRIV, the fund partners with Apollo to source its private credit sleeve, which is targeted to make up roughly 10% to 35% of the portfolio, subject to regulatory limits on illiquid assets. The trade-off for lower interest rate risk is a reduced income profile. After accounting for a 0.59% expense ratio, PRSD currently offers a 3.9% 30-day SEC yield, reflecting its more conservative duration posture.