The asset-management industry is tripping over itself to offer private credit funds to regular investors and advisors, and now the competitive landscape is taking shape.
Firms have chosen at least four distinct paths: 1) the exchange-traded fund, 2) the interval fund, 3) the exchange-traded product, and 4) the model portfolio.
The Exchange-Traded Fund
The flagship example in this case is SPDR SSGA IG Public & Private Credit ETF PRIV, which we have written about extensively. It attempts to capitalize on the fact that the ETF is the product du jour, preferred by most advisors and investors over mutual funds and other fund types, as well as SSGA’s strength in ETFs. However, ETFs are open-end funds that must manage daily flows, creating a potential mismatch with private credit, which is generally slow to trade.
SSGA has attempted to solve for this problem by entering into a liquidity arrangement with Apollo, one of the largest private credit managers in the world. As part of this arrangement, Apollo must buy back the fund’s private credit assets if SSGA asks them, up to 25% in a day and 50% in a week. Apollo can buy more than those limits if it chooses to, but these levels appear reasonable even without that potential largesse. Without exceeding those limits, it would take seven or eight trading days to reduce the fund’s private credit allocation by about 20 percentage points if SSGA only sold back to Apollo.
In conversations with Morningstar, SSGA has also indicated that the private credit assets they target are often more widely held than typical and have a history of trading, potentially giving PRIV other trading partners for those assets. This reduces liquidity concerns to a degree, especially if it holds true as the fund grows.
The Interval Fund
Compared with ETFs, where investors can withdraw their money any trading day, interval funds limit withdrawals to specific windows, or intervals, typically once per quarter. This makes the interval fund itself illiquid—investors should consider it a long-term holding—but also makes it more appropriate for owning potentially illiquid assets like private credit.
Capital Group, the trillion-dollar advisor to American Funds, has partnered with KKR to offer two interval funds that mix public and private credit. The Capital Group KKR Core Plus+ fund will invest 60% in more defensive public debt such as agency mortgages and Treasuries, while the Capital Group KKR Multi-Sector+ fund will invest 60% in riskier public debt like high-yield bonds. Both interval funds will allocate 40% to a private credit sleeve managed by KKR.
Offering private credit through an interval fund allays the liquidity risks that can exist when offering it through an ETF or mutual fund. However, interval funds require a longer commitment and are more expensive than ETFs. For example, PRIV charges 0.70%, while the cheapest share classes across the two Capital Group interval funds will charge 0.84% and 0.89%, respectively.
That is still significantly cheaper than the interval fund average fee of 2.50%, and increased competition will likely drive that average lower.
The Exchange-Traded Product
BondBloxx recently filed for an exchanged-traded product registered under the Securities Act of 1933. While these “33 Act” products trade like ETFs—SPDR Gold Shares GLD is one example—they are typically structured as trusts and require fewer disclosures and less oversight.
These ETPs issue and redeem shares in blocks of 50,000 (or multiples thereof) and do cash creation and redemptions only. Like ETFs, creations and redemptions of ETPs are limited to authorized participants. While in-kind creations and redemptions grant ETFs their tax efficiency, APs’ use of cash creations and redemptions for these ETPs isn’t a concern because grantor trusts are pass-through vehicles where the investor owns the holdings for tax purposes. Grantor trusts don’t need to worry about realizing capital gains within the fund—only investors can realize capital gains.
While the BondBloxx ETP isn’t live yet, the filing indicates that it may own up to 80% of assets in private credit. That’s significantly more than the 40% in the Capital Group interval funds or PRIV’s 35%, and it highlights another difference of the 33 Act structure: It does not have the same legal protections as funds registered under the Investment Company Act of 1940, which includes both ETFs and interval funds. Products registered under the 33 Act have no independent board of directors, no fiduciary duty to act in shareholders’ best interests, and less frequent disclosure and reporting requirements.
The Model Portfolio
BlackRock has charted a different path by offering model portfolios within Unified Managed Accounts, or UMAs, that give investors access to both public and private assets. The firm has built partnerships over the last year in the buildup to its March 26, 2025, announcement of the live launch of a “customizable public-private model portfolio.” These will be offered through GeoWealth, a turnkey asset-management platform, and use technology provided by iCapital, which helps streamline access to private investments.
BlackRock also plans to launch a tender-offer fund that invests in private equity, private credit, and infrastructure; it will be available only through BlackRock’s models.
Offering access to private assets through model portfolios doesn’t necessarily improve liquidity risk or bring fees down (though it can), but it does make the process of funding and rebalancing investments more robust. For example, if the tender offer fund grows above the model’s target allocation, it can offer a tender (or redemption) window expressly for the purpose of model rebalancing. Outside of this model environment, do-it-yourself investors would be forced to wait an indeterminate period until the next redemption window.
Conclusion
Private assets may bring diversification and opportunity to a portfolio, but investors should be careful about how they access them. Remember that in a gold rush, the ones selling the picks and shovels—in this case, the asset managers—are often the ones who get rich. A regular investor should think long and hard about what role private assets will play in their portfolio, the costs they will incur, who they give their money to, and what they might be giving up in return. Ignore the kazoos and popping champagne bottles—reasonably priced products managed by good stewards of capital will win out in the long run.