Blue Owl Sinks 68.2% From Peak as Redemptions Surge in Private Credit

Shares of Blue Owl Capital Inc. OWL plunged to an all-time low of $7.95 on April 2, 2026, falling 68.2% from its all-time high of $25.02 reached in January 2025, highlighting growing stress in the private credit space.

Year to date, OWL has lost more than 40% of its market value. At the center of the selloff has been a surge in redemption requests across Blue Owl’s private credit funds. In the first quarter alone, investors requested to withdraw approximately $5.4 billion.

Blue Owl Faces Heavy Withdrawals Across Two Key Funds

The pressure is particularly evident in the company’s two key private credit funds. Blue Owl disclosed that its $36 billion flagship fund, Blue Owl Credit Income Corp (OCIC), saw withdrawal requests equal to 21.9% of its outstanding shares. Even more striking, its $6.2 billion technology-focused fund, Blue Owl Technology Income Corp (OTIC), faced redemption requests totaling 40.7% of shares.

To manage liquidity and avoid forced asset sales, Blue Owl has imposed a withdrawal cap of up to 5% of each fund’s value per quarter. As a result, investors may not be able to access their capital as quickly as expected.

Why Are Investors Pulling Out of Blue Owl?

The current wave of redemptions appears to be driven by a combination of factors. First, rising interest rates and economic uncertainty have made investors more cautious, pushing them toward safer and more liquid assets.

Second, concerns are growing about the quality of borrowers in private credit portfolios, especially in sectors like technology, where companies are facing disruption from artificial intelligence and slowing growth. As fears increase, investors are rushing to pull out capital, creating a liquidity squeeze across funds.

Our Take on Blue Owl

The sharp decline in Blue Owl’s stock highlights a key vulnerability in the private credit market. While the asset class has delivered strong returns, the current environment is testing its resilience.

Going forward, investor sentiment and the firm’s ability to manage redemption pressures without eroding value will be crucial. Although short-term liquidity concerns are dominating headlines, the long-term outcome will ultimately depend on the underlying performance of private credit assets.

OWL’s Price Performance & Zacks Rank

In the past three months, OWL shares have lost 45% compared with the industry’s 20.7% decline. Zacks Investment Research

Image Source: Zacks Investment Research

Currently, Blue Owl carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Story Continues

Other Major Players Facing Redemption Pressure

Given the concerns, investors are heading for exits. In March, MSN reported, citing Bloomberg, that two of the biggest names in private credit, Ares Management Corporation ARES and Apollo Global Management, Inc. APO, have put a withdrawal cap on their funds.

Apollo Global capped redemptions at 5% in its $15.1 billion Apollo Debt Solutions business development company after receiving withdrawal requests of around 11.2%. Similarly, Ares Management imposed a 5% withdrawal limit on its $10.7 billion Ares Strategic Income Fund after facing redemption requests totaling 11.6%.

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This article originally published on Zacks Investment Research (zacks.com).

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