In the market battle of bulls versus bears, fear-and-greed continues to create attractive high-income opportunities (yields of 7-10%+) in specific corners of the market, including business development companies (BDCs), stock-and-bond closed-end funds (CEFs), dividend stocks and more. This report reviews the critical costs and benefits of investing in each of these groups and then counts down (ranks) my top 10 specific big-yield investment opportunities right now (selected from across the groups) as fear is currently creating some very attractive opportunities. Enjoy!
Top 10 BDCs: Ares Stands Out (Big Yield and Risks)
As the largest publicly-traded Business Development Company (“BDC”), Ares Capital (ARCC) is not only well-positioned to defend its big dividend (current yield is 9.3%) with spillover capital, but it’s also well-positioned with multiple levers for growth (e.g. conservative balance sheet leverage, fees and plenty of deal flow). And despite the big risks (such as falling rates, spread compression and “hidden” liabilities), the latest earnings announcement suggests it continues to present an attractive valuation for long-term income focused investors. This report shares data on 10 top big-yield BDCs, then reviews the details on Ares and concludes with a strong opinion on investing.