What is defined as non-traditional lending strategies and investment in credit products outside of traditional banks?

The definition of non-traditional lending strategies and investment in credit products outside of traditional banks aligns most closely with private credit. Private credit refers to financing that is not sourced from banks or public markets, but rather provided by private institutions or investors. This includes a variety of debt instruments, such as direct lending, mezzanine financing, and distressed credit investments.

In the context of alternative investments, private credit has gained prominence as investors seek yield in a low-interest-rate environment and look for opportunities to diversify their portfolios. This type of credit investment often involves higher risk but can provide attractive returns and more flexible terms than traditional financing options.

Understanding private credit is vital for alternative investment analysis as it reflects evolving financial landscapes where traditional banks may not participate, highlighting the importance of these non-traditional lending options in the broader investment ecosystem.