What are the best BDCs?
The Top 4 BDCs Today
- BDC #4: Sixth Street Specialty Lending (TSLX)
- BDC #3: Prospect Capital Corporation (PSEC)
- BDC #2: Main Street Capital (MAIN)
- BDC #1: Ares Capital Corporation (ARCC)
How Safe Are BDCs?
The debt securities that generally make up a BDC’s investment portfolio are relatively illiquid and tend to have high credit risk, or the risk of default, leading to increased volatility and a greater likelihood of large price declines during a market downturn.
How are BDCs valued?
BDC Valuation The market typically values BDCs based on trading price vs. tangible book value (see below for definitions). In theory, BDCs should trade at their tangible book value. However, in practice, in-favor BDCs trade higher, while underperformers typically trade below book value.
How many BDCs are there?
Today, there are 47 publicly traded BDCs with a combined market capitalization of more than $49 billion as of April 2021, according to Closed-End Fund Advisors, which tracks BDC data and research.
How many private BDCs are there?
50 BDCs
Currently, there are approximately 50 BDCs whose shares are listed on a national securities exchange (“listed BDCs”).
Why are BDCs selling off?
BDCs are constantly selling equity to grow their assets, because they are legally limited to a debt-to-equity ratio of 2:1. If a BDC is trading below its NAV per share, then every share sold destroys shareholder value because, as we saw with our Full Circle Capital example, it is selling $1 in assets for $0.75.
How are BDCs taxed?
As Regulated Investment Companies, BDCs aren’t considered taxable entities. In exchange for this favorable tax treatment, however, a BDC must distribute at least 90% of its taxable income to shareholders as ordinary dividends each year. Since they retain very little of their earnings, BDCs don’t pay corporate taxes.
Do BDCs pay taxes?
How does a BDC raise money?
Most BDCs make money investing in companies via debt financing (buying bonds and providing loans) to a company. If they hold stock in the companies they invest in, the BDCs profit if the stock price (or net asset value) increases. BDCs also make money by investing in senior secured bonds and loans.
How much do BDC reps make?
The average bdc representative salary in the USA is $45,000 per year or $23.08 per hour. Entry level positions start at $29,250 per year while most experienced workers make up to $70,000 per year.