The last few quarters have certainly been an interesting time for dividend and income seekers. After years of hunting for yield, as the Fed kept rates low, we’ve seen a complete reversal of fortunes. These days, humble cash is now paying over 4%. For many high-yielding pockets of the market, the ability for investors to get a decent yield in safe assets has been abysmal for total returns.
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And that includes business development companies (BDCs).
But investors may not want to cast away BDCs just yet. The public-private equity firms have continued to grow book value, produce strong dividends, and in some cases reward investors with inflation-beating increases and special payouts. The sector still remains a risky bet, but one that could provide plenty of reward longer term.
