Private fixed income: Where size and access create opportunity
Private loans are the quiet powerhouse of fixed income investing – and they’re becoming more accessible.
What is private fixed income?
When you think of fixed income you usually think of government bonds like Government of Canada bonds. With private fixed income or PFI, investors lend directly to businesses, infrastructure projects or real estate developers – outside of the publicly-traded bond market. They work directly with borrowers to set loan terms, decide on interest rates, repay schedules and safeguards. Since these loans don’t trade on an exchange or have market prices that change every day, their value comes from the borrower’s strength and the steady income generated by the loan.
Being insulated from the ups and downs of public markets means private loans are designed to deliver more stable returns and less short-term volatility. And since investors agree keep their money in PFI for longer, they typically earn higher yields as a reward for their patience. Each deal is customized, often backed by collateral and strong protections, giving PFI portfolios a powerful mix of income, diversification and downside protection.
Why size and access matter
PFI isn’t something all investors have access to. Deals are sourced through networks and relationships – they’re offered, not advertised. That’s why size makes all the difference. The best opportunities usually go to large, trusted lenders with the expertise and connections to negotiate directly with borrowers. And large borrowers can review more deals, demand stronger terms and better manage risk. With PFI, access is everything.
Sun Life ETF+ Portfolios gain exposure to PFI through investments in underlying funds managed by SLC Management, Sun Life’s institutional asset manager and one of Canada’s most established PFI platforms – the same one used by major pension funds and insurance companies.
This platform offers:
- Global reach. Investments across private loans, infrastructure debt and real estate credit around the world.
- Institutional discipline. Underwriting standards shaped by decades of experience managing billions for long-term investors.
- Scale and relationships. Direct access to transactions that are typically off limits to retail investors.
What could PFI investing look like?
One real-life example is a secured loan offered by one of Canada’s largest private operators of long-term care homes, backed by the operator’s assets. The loan is:
- Supported by long-term government funding.
- Managed by an experienced team.
- Invested in an essential sector driven by aging demographics and limited supply.
This kind of investment shows what PFI does best – generate steady, reliable income from core parts of the economy like health care and infrastructure. But not everyone has access to opportunities like this. They’re created through direct relationships, scale and expertise – advantages that come with size and institutional reach.
Why PFI belongs in Sun Life ETF+ Portfolios1
It isn’t just another bond sleeve – it’s an institutional-grade income engine. Through SLC Management, we can give advisors and their clients the access, diversification and yield once reserved for the largest investors.
In the ETF+ Portfolios, PFI helps provide stability and cash flow, working alongside other key components:
- U.S. sector rotation for growth potential.
- Gold for portfolio protection.
Together, these components help balance growth, stability and access to create a modern multi-asset portfolio designed to perform across market cycles.
1Sun Life ETF+ Portfolios are mutual fund trusts that invest in a portfolio of ETFs and mutual funds and are actively managed by SLGI Asset Management Inc. Exposure to private fixed income is achieved through investment in the SLC Management Private Fixed Income Plus Fund.
Information contained in this article is provided for information purposes only. It is not intended to provide or be a substitute for professional, financial, tax, insurance, investment, legal or accounting advice and should not be relied upon in that regard. It also does not constitute a specific offer to buy and/or sell securities. You should always consult your financial advisor or tax specialist before undertaking any of the strategies discussed in this article to ensure that all elements and your personal circumstances are taken into consideration in developing your individual financial plan. Information contained in this article has been compiled from sources believed to be reliable, but no representation or warranty, express or implied, is made with respect to its timeliness or accuracy and SLGI Asset Management Inc. disclaims any responsibility for any loss that may arise as a result of the use of the strategies discussed.