TabCap Investment Management, a hedge fund that eschewed the recent boom in the private credit sector is thriving as its focus on investments in liquid credit instruments delivers strong returns, according to a report by Bloomberg.
The report cites an investor letter seen by Bloomberg News as revealing that TabCap, which was founded in 2021 by former Cheyne Capital Partners duo David Peacock and John Weiss with $30m in seed capital, has grown its assets under management to over $1bn.
The fund’s liquid credit income strategy returned 11.5% in 2025, while its structured credit income fund posted 17.7%, outperforming a Bloomberg index of credit-focused hedge funds, which returned 7.76% over the same period.
Peacock highlighted the advantages of liquid portfolios, noting they provide “a clearer long-term growth path, and a way out if desired.” TabCap invests exclusively in credit indexes and related instruments, avoiding single-company loans, CLOs, and private market credit, giving it flexibility to hedge positions, trade efficiently, and reinvest earnings immediately.
The firm’s growth contrasts with turbulence in private credit markets, which have been hit by high-profile losses, regulatory scrutiny, and investor redemptions. Last month, a BlackRock private debt fund marked down its assets by 19%, while investors pulled 15.4% from a Blue Owl Capital tech-focused fund.
TabCap’s approach reduces exposure to idiosyncratic risk, while leveraging mis-pricings across public credit markets to generate returns. While investors forgo the illiquidity premium associated with private credit, the fund gains flexibility and compounding potential from liquid, tradable instruments.
TabCap now operates four distinct strategies, all rooted in liquid credit, providing a rare example of a hedge fund built entirely on public-market credit indexes.
