However, some observers are wary about BDCs’ internal fee structure. For instance, the Russell and S&P indices have booted BDCs from their indices due to accounting and reporting requirements and expenses. Specifically, business development companies are required to disclose so-called acquired fund fees and expenses, which are a type of business expense and not considered “fees” in the way fund investors are familiar with. [Making Sense of Acquired Fund Fees in BDC ETFs]
Wilshire recently launched the Wilshire BDC Index Wednesday, which Benjamin suggests could pave the way for an investible product soon.
BIZD tracks 29 BDCs from the Market Vectors US Business Development Companies Index while the UBS E-TRACS ETNs are based off the Wells Fargo Business Development Company Index.
For more information on BDCs, visit our business development companies category.