BDCs: 5 Reasons They’re Special (6% to 12: Yields)

A lot of investors scoff at the absurdity of big-yield investments under the assumption that markets are fairly efficient and anything with a big-yield (defined loosely as a 6% to 12% yield) is a “yield trap” and should be avoided at all costs. However, Business Deveopment Companies (BDCs) are one of the few “big-yield” categories that has consistently produced top total returns (despite their massive dividend payments—which some investors dismissively view as too risky).