2 BDCs To Dump Before Their Yields Get Cut
The BDC sector is facing a wave of dividend cuts due to lower base rates and tighter spreads. Some BDCs, such as FSK and TCPC, are particularly affected by non-accruals. The article identifies two BDCs with unsustainable yields that investors may want to avoid.
- ▪The BDC sector has experienced a significant wave of dividend cuts.
- ▪Key drivers for these cuts include lower base rates in Q3–Q4 and tighter spreads.
- ▪Investors are advised to consider avoiding certain BDCs to prevent cash flow reductions.
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