Since the debt is typically senior secured and set to float with interest rate benchmarks, there is diminished rate risk. When the Fed raises rates, BDC loan interest rates pegged to the London Interbank Offered Rate, or LIBOR, will also rise.
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]
“The fourth quarter should show much improvement, writes analyst Douglas Mewhirter on Wednesday. New deals are closing with better terms for lenders and yields should be rising over the next year,” according to Barron’s.
Market Vectors BDC Income ETF
