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Risks
1. Market Risk: New Mountain Finance Corporation invests in various types of debt securities and private equity investments, the volatility of the markets can lead to a decrease in the value of these investments and reduce returns.
2. Credit Risk: New Mountain Finance Corporation is exposed to the potential default of the companies or people they lend money to. This could lead to a complete or partial loss of the funds they invest in these assets.
3. Interest Rate Risk: New Mountain Finance Corporation invests in floating-rate loans and other debt securities with changing interest rates. An increase in interest rates would reduce the return generated by these investments.
4. Liquidity Risk: Above-average returns are generated in part through investments in hard-to-sell assets. If New Mountain Finance Corporation needs to liquidate these investments quickly, they may not be able to sell them for the expected amount.