Leading hedge funds, including Point72, King Street Capital, Millennium and Schonfeld, are establishing standalone private credit businesses as investor appetite for the fast-growing asset class continues to surge, according to a report by Financial News London.
The initiatives have prompted firms to redeploy talent and resources from within their existing platforms.
Private credit is forecast to grow into a $5tn market by 2029, according to a report published last year by Morgan Stanley. Historically, credit strategies typically sat within hedge funds’ broader fixed income platforms. However, the scale of investor inflows has encouraged managers to carve out specialist teams and infrastructure.
Last year, Steve Cohen’s Point72 launched a new private credit strategy and hired former Blackstone senior managing director Todd Hirsch to lead the effort. At the time, Cohen told staff that demand for private credit continued to outstrip available supply.
King Street Capital launched a European-focused private credit fund in 2025, backed by Generali Investments. Schonfeld established its credit unit in 2022, appointing Andrew Silverman to oversee the strategy.
Millennium is the latest firm planning to separate private credit from its wider fixed income business, with the new unit expected to be led by Dan Friedman, according to reports.
The trend has already fuelled rapid asset growth among newer credit-focused hedge funds. Arini, founded by former Credit Suisse trader Hamza Lemssouguer, has grown assets from nearly $1bn at launch in 2022 to almost $15bn.
Meanwhile, London-based Sona Asset Management added more than $6bn in assets during 2025 and now manages approximately $16bn.
