Blackstone Alternative Credit Advisors, also known as Blackstone Credit, is a massive hedge fund branch of The Blackstone Group, one of the largest financial institutions in the country. Previously known as GSO Capital Partners, Blackstone Credit manages $57 billion in client assets across 120 pooled investment vehicles, also known as funds. At 188 strong, the firm's team of financial professionals is on the larger side. This firm is based out of an office on Park Avenue in New York City.
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Blackstone Credit Background
Blackstone Credit was founded in 2005 under the name of its predecessor firm, GSO Capital Partners. Shortly after, in 2008, Blackstone acquired a controlling stake in the business. The Blackstone Group is still the parent company of Blackstone Credit, which assumed its current name in 2020 as the firm rebranded away from GSO Capital Partners.
The Blackstone Group is a large, multi-national investment corporation with many different business arms. In addition to hedge fund solutions, the firm also works with separately managed accounts and provides other investment services.
Blackstone Credit Investment Philosophy
Blackstone Credit manages many funds. through which it invests in a wide array of markets and securities. According to its Form ADV, the firm typically deals with investments in first and second lien loans, high-yield bonds, distressed and other securities, public equity, private equity and derivatives. While it doesn't usually tailor its investment strategies based on client objectives, it may do so in certain scenarios.
When it comes to evaluating potential investments, Blackstone Credit seeks to do as much due diligence as possible. It uses a variety of both proprietary and non-proprietary research models and analysis methods. It also uses both internal and external research resources. The firm utilizes bottom-up analysis to identify both long- and short-term opportunities in the market, depending on its particular investment goal at any one time.
Largest Hedge Funds Managed by Blackstone Credit
GSO Capital Opportunities Fund III LP
- AUM: $6,915,313,829
- Minimum: $10,000,000
- Beneficial Owners: 158
GSO Capital Solutions Fund III LP
- AUM: $5,356,384,523
- Minimum: $10,000,000
- Beneficial Owners: 143
GSO European Senior Debt Fund II EEA SCSP
- AUM: $3,705,288,128
- Minimum: $10,000,000
- Beneficial Owners: 87
GSO Energy Select Opportunities Fund II LP
- AUM: $3,588,460,273
- Minimum: $10,000,000
- Beneficial Owners: 100
GSO European Senior Debt Fund LP
- AUM: $2,484,386,612
- Minimum: $7,000,000
- Beneficial Owners: 61
Fees at Blackstone Credit
As is the case with most hedge funds, Blackstone Credit takes both management fees and performance fees from its funds. Management fees at Blackstone vary based on the specific fund, but typically sit at up to 2% of the fund's net assets annually. These fees are usually paid quarterly or monthly.
Performance fees function slightly differently. Blackstone Credit charges a performance fee of up to 20% of the net profits of any fund on an annual basis. Unlike management fees, performance fees are typically debited on an annual basis. Since Blackstone doesn't provide specific fee schedules, you'll need to reach out to the firm for more information on particular fees for any one of its funds.
What to Watch Out For
There are no legal or regulatory disclosures present on Blackstone Credit's SEC-filed Form ADV.
Only accredited investors can invest in hedge funds. If you want to be considered "accredited," you must have at least $200,000 of earned income ($300,000 for couples) over the course of the past two years, along with a reasonable assumption that that trend will continue for the current year. You can also become an accredited investor if you have at least a $1 million net worth, minus the value of your primary residence. This can be either on your own or together with a spouse.
Becoming a Client of Blackstone Credit
Remember that only accredited investors can work with a hedge fund manager like Blackstone Credit. If that describes you, you can reach out to Blackstone directly by visiting the firm's website, calling (212) 503-2100 or sending an email.
All information is accurate as of the writing of this article.
Investing Tips
- Investing for the long term can be tough to do on your own. Therefore, it can be a good idea to have someone in your corner who can help you manage your portfolio. A financial advisor can fit this role, and finding one doesn't have to be hard. In fact, SmartAsset’s free tool matches you with up to three financial advisors in your area in five minutes. Get started now.
- If you're investing for a specific goal, like retirement, it pays to plan ahead. SmartAsset has a number of investment resources you can use, including our free investment calculator.
