Not everyone wants higher interest rates. For homeowners, rising rates could translate to higher mortgage payments. For corporations, higher interest rates would increase their debt repayment burden. However, it’s not all going to be bad news, because there are strategies for investors to capitalize on rising interest rates. Since we are Income Investors, I’m going to show you a relatively safe one. With this play, there’s no need to use complicated financial derivatives. And you get paid a double-digit income stream just to be part of the game.
Sounds too good to be true? Well, let me explain...
In order to take profit from higher interest rates, you need to keep track of two simple variables: revenue and expenses. If you can increase your revenue when interest rates increase while keeping your expenses fixed, chances are you’ll see more profits on the bottom line. As it turns out, one company is well positioned to do exactly that: Prospect Capital Corporation (NASDAQ:PSEC). Headquartered in New York City, Prospect Capital is a business development company, or BDC. Its main business is to invest in middle-market companies in the U.S., most through debt financing. In other words, PSEC lends out money and collect interest payments.
Source: Income Investors
Related Articles:
- International Securities For A Diversified Income Portfolio
- International Securities For A Diversified Income Portfolio
- 6 Dividend Stocks That Gave Me A 20%+ Annualized Return
- 3 Simple Steps For A Successful Retirement
- 6 Rainy Day Dividend Stocks
________________________________________________________________
Subscribe to:
Post Comments (Atom)
Popular Posts Last 30 Days
-
So, stocks are the place to go. But which stocks? While the market is clearly the place to go for strong returns, investors have different p...
-
Strange but true: seniors fear death less than running out of money in retirement. So what's a retiree to do? You could cut your expense...
-
Over the past few years, dozens of companies have recognized this cash flow conundrum. So in an effort to support their shareholders, some b...
-
If you're anticipating a long retirement, you'll want to remain invested in stocks to give your money a chance of outpacing inflatio...
-
One way to identify suitable candidates is to look for stocks with an average dividend yield of 3%, and positive average annual dividend gro...
-
When writing this article, I was looking for an ideal list of dividend-paying stocks that consistently raise their dividends each year. In a...
-
Exxon Mobil Corporation (NYSE:XOM) stock is trading at the same level as it was during the beginning of 2019. Even with company-specific pos...
-
A different approach is to focus on the payout. However, it’s important not to simply invest in companies that offer the largest payout. Tha...
-
As a new decade approaches, it's a good time to think about putting a few stocks in your portfolio that can stand the test of time, pote...
-
One of the Best Dividend Stocks of the Past Decade. If you ask most people to name the best dividend stocks, they’ll rattle off a similar li...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.