Alex Jamieson: The hidden risk behind Australia’s yield hunt
Announcement posted by Invigorate PR 09 Apr 2026
Australians chasing higher returns are being warned they may be walking into one of the most misunderstood and underappreciated risks in today's financial market, with private credit, debentures and mortgage bonds coming under increasing scrutiny.
Leading financial adviser Alex Jamieson, founder of AJ Financial Planning and newly launched advisory, Jamieson Private Wealth, said the rapid growth of private lending markets has created a false sense of security for both retail and wholesale investors.
"Private credit has been sold as the perfect solution, higher yield, steady income and perceived stability," Jamieson said.'
"However, the reality is, many investors don't fully understand what sits beneath these returns."
The gap left by banks has been filled, but at what cost?
Following the withdrawal of traditional banks from higher-risk lending after the Global Financial Crisis, a significant gap emerged across areas such as low-doc and non-conforming loans, venture and buyout funding and higher-risk commercial and development lending
Jamieson said this gap has been aggressively filled by non-bank lenders and global private credit giants, including major players such as La Trobe Financial, BlackRock and Blue Owl.
"What we've seen over the past decade is the rapid institutionalisation of private credit," he said.
"Large global funds and domestic players have stepped in to capture yield where banks stepped back."
Jamieson warned that this structural shift has also transferred risk into areas where transparency, liquidity and regulation can be more limited.
Chasing yield in a changing environment
With interest rates rising and traditional fixed-income assets under pressure, investors have increasingly turned to private credit, debentures and mortgage-backed products in search of stronger returns.
"Yield has become the magnet," Jamieson said.
"However, when everyone is chasing yield, risk tends to be underpriced."
He said many of these products are marketed as stable, income-generating investments, but can carry complexities that are not always well understood.
"These are not simple term deposits," he said.
"They are lending structures exposed to borrower quality, asset values and broader economic conditions."
Liquidity risk: the issue many investors overlook
One of the most significant risks, according to Jamieson, is liquidity.
"In strong markets, liquidity is rarely questioned," he said.
"However, when conditions tighten, that's when the cracks can appear."
He said recent global commentary around private credit has drawn comparisons to early warning signs seen in previous cycles.
"When market conditions shift in real time, assets that were assumed to be stable can suddenly behave very differently," he said.
"That's what investors need to understand."
Unlike listed assets, many private credit investments are not easily exited.
"You may not be able to access your capital when you want to," he said.
"That becomes a real issue in stressed environments."
Defaults are the pressure point
Jamieson said rising defaults across residential, commercial and business lending are the key risk factor to watch.
"As interest rates remain elevated and economic pressure builds, borrower stress increases," he said.
"That flows directly through to lenders and ultimately to investors."
He said private credit structures are particularly sensitive to borrower performance.
"If the underlying loans start to deteriorate, returns can be impacted quickly and in some cases, capital can be at risk," he said.
Regulation and disclosure under the spotlight
Jamieson said recent regulatory scrutiny of disclosure practices in the sector highlights the need for investors to be cautious.
"When a single word change in documentation can become the centre of a regulatory dispute, it shows how critical clarity and transparency are," he said.
He warned that investors should not rely solely on marketing materials or headline returns.
"You need to understand what you are investing in, how it is structured and what the risks actually are," he said.
Not all private credit is the same
Jamieson emphasised that private credit is not inherently bad, but it is not universally safe.
"There are high-quality operators in the market, but there is also a wide spectrum of risk and not all products are created equal," he said.
He said due diligence is critical.
"Who is lending? What are they lending against? What is the quality of the borrower? What happens in a downturn?" he said.
"These are the questions investors need to be asking."
A wake-up call for investors
Jamieson believes the current environment is a turning point.
"For years, private credit has grown in a relatively benign economic environment," he said.
"Now we are entering a more challenging phase and that's when true risk is revealed."
He said investors, retirees and superannuation holders need to move away from blind trust and adopt a more active approach.
"This is not about panic, it's about awareness," he said.
"Higher returns always come with trade-offs. The problem is, many people don't see the trade-offs until it's too late."
The bottom line
Jamieson's message is clear.
"If you are investing in private credit, debentures or mortgage-backed products, you need to understand exactly what you own," he said.
"Critically, in this market, what looks safe on the surface may carry risks that only emerge when conditions tighten."
As the hunt for yield continues, he warned that discipline and insight will be the difference between protecting wealth and losing it.
"This is where smart investors separate themselves, not by chasing returns, but by understanding risk," he added.
About Alex Jamieson
Alex Jamieson is one of Australia's most trusted and respected financial advisers and the founder of Jamieson Private Wealth, a Melbourne-based advisory firm delivering sophisticated, personalised financial advice to individuals, families and business owners.
With decades of experience across financial planning, investing and retirement strategy, Alex is known for combining deep technical expertise with a disciplined, long-term approach to wealth creation and protection. His advice is grounded in rigorous research, responsible investing principles and the intelligent use of technology to monitor local and global markets for opportunities, risks and emerging trends.
Alex holds his own Australian Financial Services Licence (AFSL) and is widely regarded for his integrity, clarity and commitment to helping clients make confident, informed financial decisions. He specialises in retirement planning, investment management, tax optimisation, estate planning and risk management, tailoring every strategy to reflect each client's goals, values and stage of life.
Jamieson Private Wealth represents the evolution of Alex's advisory career delivering next- generation wealth advice built on experience, insight and trust.