Private credit lets us sleep through ASX reporting season

Every February and August, the same ritual unfolds across the ASX. Screens light up, analysts twitch, brokers pace, and investors brace for impact. Reporting season arrives like a noisy kids’ play centre: loud, chaotic, unpredictable, and full of small humans (or in this case, small caps) screaming for attention.

Meanwhile, in the world of private credit we’re strolling through the South Melbourne Market with noise‑cancelling headphones on, listening to a soothing playlist, and wondering what all the fuss is about.

I take my noise‑cancelling headphones everywhere. They’re brilliant on planes, great for avoiding the riff‑raff, and—colloquially—I even wear them during reporting season. They keep me sane, focused, and blissfully insulated from the drama. Because the truth is: I have very little in common with the ASX and I love that. What we do have in common though is: Boring is beautiful.

Banks, miners, telco —steady, predictable names—are being rewarded. High‑growth darlings? They’re being punished for even the slightest wobble. One company posted record half‑year earnings—up 86% year on year—yet its share price fell 38% in a single session because results came in slightly below expectations. That’s reporting season in a nutshell: perfection priced in, punishment delivered swiftly.

Someone sent me a screenshot last week of a stock down 40% after reporting. My response was immediate and only half‑joking: “I hate shares.”

It’s the same dynamic I saw on a catamaran day cruise recently in Queensland. Conditions weren’t terrible but weren’t calm either. Same boat, difference reactions.

A few international tourists reached straight for the vomit bags upon minor turbulence, others clung to the rails, a handful pretended they were fine and others (more seasoned) barely noticed the movement.

Same boat. Different reactions. Markets are no different.

Reporting season tests your stomach. It tests your patience. It tests your conviction. And it forces you to ask: Do I really want to be on this boat?

Some investors thrive on volatility. Others endure it. Many struggle with it. The question isn’t whether markets move — they always do. The question is whether you have the stomach for the ride.

Private credit—especially agricultural private credit—lets us choose smooth sailing instead. In hindsight, we should have opted for the sunset cruise in calm waters around the marina that day given the reef was sadly underwhelming. Sounds rather similair to an overpromised, under delivered profit result.

Why We Sleep Soundly

In our world, next month’s income is already known. Next year’s income is contractually locked in. There’s no guessing, no “consensus expectations,” no violent re‑rating because someone’s margin was 20 basis points lighter than forecast.

We don’t rely on market timing. We don’t need to predict which way the wind will blow. We don’t wake up wondering whether a CEO’s tone in the Q&A will wipe 15% off a position.

Our returns come from:

• Contracted interest payments
• Secured loans backed by real agricultural land
• Conservative LVRs
• Short loan durations
• Uncorrelated performance

FarmCap, for example, focuses on non‑bank agricultural debt secured by Australian farmland—an asset class with remarkably low volatility. With registered mortgage security, conservative LVRs, and short 6–18 month loan terms, the portfolio behaves nothing like equities. It’s intentionally boring. Predictable. Stable.

And in a world where a “miss” can erase billions in market cap overnight, boring is a luxury.

The Reporting Season Rollercoaster

For equity investors, reporting season is stressful because it forces a high‑stakes confrontation between expectations and reality and compresses uncertainty in short, intense bursts. Even good results can trigger sell‑offs if they don’t match the market’s fairy‑tale narrative.

• Violent reactions: 15–20% moves in a day are common.
• The “miss” penalty: Slight underperformance = disproportionate punishment.
• Short‑termism: One soft number can overshadow years of strong fundamentals.
• Compounding damage: Earnings misses often lead to months of underperformance.

It’s unpredictable, emotionally draining, and often irrational.

Private credit avoids all of this.

Transparency matters — and scrutiny is healthy

Private credit isn’t risk-free but private markets offer opportunities that public markets simply can’t. It can however be opaque, illiquid, and sensitive to economic conditions and regulators are paying closer attention — rightly so.

ASIC’s REP 820 recently shone a bright light on the private credit sector with its focus on improved disclosure standards, governance, and risk management which pushes the industry toward greater transparency and discipline. That’s good for investors.

Clear reporting. Defined risk frameworks. Strong governance. No surprises.

Or as we like to summarise it: no funny business. Pick your investment manager wisely and ensure to look under the hood.

In short, we made it easy for investors to see exactly what they own and how it’s performing. Private credit done properly—conservatively, transparently, and with genuine alignment— becomes one of the most stable, predictable income streams available.

Staying in Our Lane

Some portfolio managers talk about being “overweight.” We prefer concentrated conviction. Not the kind that comes from chasing the next market darling, but the kind that comes from deep due diligence, conservative structuring, and lending against real assets with real value.

It’s hard to be overweight eating a healthy mix of meat, grains and fruit and vegetables.

Its like walking through a chaotic market with noise‑cancelling headphones. You stay in your lane. You avoid the distractions. You focus on what matters.

Choose wisely, and you don’t just survive reporting season. You sleep through it without FOMO.