// definition
NAV loan
Borrowing against net asset value
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Short definition
A loan taken by a fund against the net asset value of its whole portfolio, often to finance follow-on investments or distributions. Leverage added at the fund level, on top of the debt of the companies held, and barely visible to end investors. Typical advance rate of 5 to 25% of NAV, cross-collateralised on the entire portfolio.
risk atlas
Knowledge map
Intuition
The NAV loan adds a debt at the fund level, above the borrowers themselves.
Formula
total leverage = company debt + debt carried by the fundWhy it matters now
When exits rise, funding distributions or redemptions with NAV loans can temporarily mask the liquidity pressure.
Related analyses
- The silent contagion of private creditBridges between banks, insurers, BDCs, crypto and stablecoins.
- Zombie funds and private valuationsPrivate marks, hard exits and the illusion of stability.
- NAV loans, the hidden fund-level leverageHow funds borrow against their own portfolios.
Related guides
- Analysing private creditValuation, liquidity, leverage, covenants and breaking points.
Related datasets
- debt-risk.jsonDebt Risk Radar snapshot with provenance.
- risk-diff.json1, 7 and 30-day diff of signals, sources and models.
- evidence-graph.jsonClaims, evidence and their sources as a graph.
- catalog.jsonMachine-readable catalogue of l0g surfaces.
Signals using it
- MethodologyDebt, interest burden, current stress and structural vulnerability.
- Risk DiffRecent change in risk and source freshness.
- Black Box RecorderHashed frames to replay a point-in-time state.
Primary sources
- SEC EDGARBDC filings, 10-K, 10-Q, 8-K and institutional disclosures.
- Financial Stability Board & OFRNon-bank intermediation, financial stability and monitors.
- International Monetary FundGlobal Financial Stability Report and funding stress.
- Bank for International SettlementsGlobal credit, NBFI and market vulnerabilities.