Cross-Cycle Stress Testing

Navigating Four Market Cycles Cross-Cycle Investment Record

Anyone can look smart during a bull market. The real test is surviving crashes without losing capital. We've steered capital through four major market disruptions without a single debt default.

4

Economic Regimes

Zero

Debt Defaults

100%

Fixed-Rate Debt Mandate

100%

Partner Capital Aligned

Regime I

The Great Financial Crisis

2008 – 2011

Market Context

Global credit freeze. Subprime debt collapsed. Banks failed, and foreclosures swept the nation.

Investment Defense

Held 100% fixed long-term mortgages. Maintained 12-month operating cash buffers. Refused all adjustable debt.

Outcome

Zero debt defaults. Capital stayed safe while over-leveraged competitors went into liquidation.

Regime II

Zero-Rate Expansion & Tech Boom

2014 – 2020

Market Context

Ten years of near-zero interest rates. Tech multiples reached 50x revenues. Real estate buyers took aggressive floating debt.

Investment Defense

Strict acquisition discipline: capped real estate purchases at 75% of replacement cost and rejected overpriced seed rounds.

Outcome

Strong cash distributions and protected basis. Avoided the painful 80% valuation write-downs that later hit tech.

Regime III

The Pandemic Liquidity Shock

2020 – 2021

Market Context

Fastest market drop in modern history. Businesses closed. Cities locked down overnight.

Investment Defense

Cashed in pre-funded crash-put options (+800% gains) during the March panic to generate immediate liquidity.

Outcome

Deployed fresh cash into discounted physical assets while other funds scrambled for emergency capital.

Regime IV

The 500 bps Rapid Rate Shock

2022 – 2026

Market Context

Fastest rate hike in 40 years. Debt costs surged from 3% to 8%, stranding floating-rate borrowers.

Investment Defense

Zero floating debt exposure. Swept cash collateral into 5% Treasury bills and generated 12–15% cash yield via options overlays.

Outcome

Zero capital calls and zero defaults, delivering steady cash yield while peers faced distress and recapitalizations.

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