After years in which investors struggled to find meaningful yields, higher interest rates brought income back to traditional fixed-income portfolios. Now, with monetary policy moving in different directions across economies, the challenges are changing once again. Credit spreads, duration risk, persistent fiscal pressures and geopolitical uncertainty all complicate the search for attractive risk-adjusted returns.

The return of yield has not eliminated the case for alternative fixed income. If anything, it has made the distinction between different sources of return more important. Flexible hedge fund strategies can respond to changing interest-rate expectations and exploit pricing discrepancies, while specialist credit managers can provide financing where traditional lenders are less active. Meanwhile, private credit has evolved far beyond corporate direct lending into a broad universe of asset-backed financing, fund finance, infrastructure debt and increasingly specialized structures.

For investors, the expanding opportunity set brings both possibilities and responsibilities. Higher yields are attractive, but liquidity, leverage, collateral quality and the ability to withstand difficult market conditions matter just as much. This year’s Alternative Fixed Income report explores these considerations through the experiences of Nordic institutional investors and specialist managers.

Please find the report here. Happy reading!

We begin with “Afa Försäkring Seeks to Diversify Beyond Traditional Direct Lending,” where Marie Lindskog explains how the Swedish insurer is looking to broaden its private credit exposure beyond sponsor-backed senior direct lending. “The Investment Case for European Infrastructure Debt” follows, with Sundeep Vyas of Deutsche asset managementexamining the financing opportunities created by Europe’s energy transition, energy security and digitalization. Vyas also explains where infrastructure debt fits within institutional portfolios.

In “Bliwa Balances Fixed Income Stability with Selective Risk-Taking,” CIO Fredrik Fors discusses how the Swedish insurer constructs its fixed-income portfolio around its relatively short liability profile, liquidity requirements and capital-preservation objectives. The article explores Bliwa’s combination of money-market investments, investment-grade and high-yield credit, and selected private-market exposures. 

The focus then turns to a more specialized corner of the Nordic market. “An Invitation-Only Market: Evli’s Approach to Nordic Mid-Market Loans” explores how Jussi Hyyppä and Mikael Lundström navigate a lending market built around relationships, local knowledge and access to transactions. The article looks at Evli’s focus on privately negotiated senior secured loans to established, primarily private equity-backed Nordic companies. 

Nordic corporate credit also features in “Beyond the Yield Premium: Finding Value in Nordic High Yield,” where Christoffer Malmström of Ridge Capital shares his views on the market alongside two institutional investors: Reto Ineichen, Chief Investment Officer at Alpinum Investment Management, and Helmut Neumaier, Head of Investment at a Munich-based foundation. Together, they discuss the Nordic market’s structural attractions, its yield premium over European and US high yield, and the importance of active management, credit selection and downside protection.

The growing sophistication of private-market financing comes into focus in “P+ Looks Beyond Direct Lending to NAV and GP Financing.” Mikkel Loft explains how the Danish pension fund is exploring financing secured against private equity portfolios and fund managers. In “Securitized Credit, CLOs and Capital Call Financing Offer New Routes to Fixed Income Diversification,” Sid Chhabra of RBC BlueBay Asset Management examines opportunities across structured credit markets, and other corners of alternative fixed income. The article explores opportunities across securitized credit, collateralized loan obligations (CLOs), and capital call financing.

Aegon Asset Management’s Bas Kragten takes a closer look at subscription-line lending in “Capital Call Financing: An Investment-Grade Opportunity in Private Credit.” Kragten discusses the market’s growth, the characteristics of its investor base and why capital call financing can provide an attractive spread premium over comparable public-market instruments. The broader universe of portfolio-level financing is explored in “Portfolio Finance 101: Understanding a Growing Corner of Private Markets.” Matt Hansford of Barings explains how portfolio finance differs from traditional subscription lines by using diversified pools of existing investments as collateral rather than uncalled investor commitments.

We conclude with an important question about how investors assess the asset class itself. In “Looking Behind the Headline Figure of the Private Credit Index,” Tero Pesonen of LocalTapiola Asset Management examines what private credit benchmarks actually measure and why comparisons with public markets deserve careful scrutiny.

Together, these contributions illustrate how alternative fixed income has become a collection of increasingly distinct strategies rather than a single asset class defined by higher yields and reduced liquidity. The opportunities are expanding, but so are the demands on investors to understand the underlying risks.