Dividends4Life: 3 BDCs to Buy for Double-Digit Yields

3 BDCs to Buy for Double-Digit Yields

Posted by D4L | Saturday, August 01, 2015 | | 0 comments »

When it comes to high-yielding investment vehicles, real estate investment trusts (REITs) and master limited partnerships (MLPs) are the most well-known. Almost every portfolio has exposure to them these days. The vast majority of 401(K)-styled retirement plans offer some sort of REIT option these days. But there is another pass-through entity that investors looking for high-income should familiarize themselves with. We’re talking about business development companies (BDCs).

Investors can think of BDCs as publicly traded private equity or venture capital firms. Many midsized firms are too small to launch a full corporate bond issue and are too large to go their local bank branch and request a loan. Finding sources of capital can actually be quite difficult. BDCs will step in a loan those firms the needed money — often at very advantageous rates and with an equity kicker. Here are three quality BDCs to buy with double-digit dividend yields: Hercules Technology Growth Capital (HTGC), Ares Capital Corporation (ARCC) and Pennant Park Investment Corporation (PNNT).

Source: InvestorPlace

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