Recover Blue Owl Losses

Investors looking to recover Blue Owl losses have recourse. Many Blue Owl funds will lose significant value and could become essentially worthless when the Company ceases redemptions. Private credit investments like Blue Owl make high-interest loans to companies with bad credit. As such, they are speculative investments. Advisors often inappropriately recommended or misrepresented the risk to moderate- and conservative-investor clients. The true level of risk was, or should have been, known to advisors from the beginning. These risks have recently come to fruition. This means many advisors are responsible for repaying these Blue Owl losses.

Blue Owl Losses

In February 2026, the asset manager sold debt holdings equal to $1.4 billion. According to Reuters, investor demand for liquidation necessitated the sale. In what could be a sign of future problems, Blue Owl permanently restricted traditional redemptions in Blue Owl Capital Corp. II (OBDC). The stock tumbled through the end of the month.

According to the Wall Street Journal, the asset sale was to shore up “wobbling investor confidence.” This was not enough, as evidenced by the shares dropping as much as 10% during a single day.

At the end of 2025, the market turned against private funding and business development investments as risks became apparent. In response, Blue Owl has increased redemptions. While liquidity is generally good, the investor rush signals a lack of confidence in the investment. Investors exited the investment in droves. Even with the redemptions, Blue Owl is only allowing tenders of 19%. The offer expired before the end of 2025.

Your Advisor

Your licensed broker or advisor is required to recommend investments in your best interests. This means putting your own interests ahead of theirs. Business development companies like Blue Owl often pay brokers and advisors heightened commissions. As a result, investment professionals often omit risk disclosures for such investments. Regulators consider these investments to be high risk and unsuitable for moderate investors. This would include not only Blue Owlbut also other private credit investments, such as Blackstone and Apollo Global Management.

Morgan Stanley is considered to be the most active broker offering this investment to the public. It allegedly acted as an underwriter, selling broker-dealer, or distribution participant specifically for Blue Owl Capital Corporation II, though exact involvement is still being investigated. Many other firms also recommended the investment.

Jeffrey Pederson is an attorney who represents investors and has successfully done so for over 20 years. Call for a free and confidential initial consultation with Jeffrey Pederson.