Increasing the frequency of marks does little to improve transparency or accuracy in private credit when prices are not anchored to observable, market-based transactions.
Producing a daily price mark using model-based inputs is simply a higher-frequency version of the same process that already generates wide dispersion among prices of comparable assets.
Price marks diverge because managers use different assumptions, and no one is required to transact at the stated price.
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Key takeaways:
Daily pricing is not price discovery. Producing a daily price mark using model-based inputs is simply a higher-frequency version of the same process that already generates wide dispersion among prices of comparable assets. Without
