From Barchart:

Business Development Companies (BDCs) are known for offering high yields, but also come with significant risk due to their exposure to leveraged debt investments. These companies typically invest in small and medium-sized businesses, providing them with funding in exchange for equity stakes. As a result, the potential for high returns is balanced by the risk of default and the impact of economic downturns on their portfolio companies. Investors should carefully consider these factors before investing in BDCs to ensure they align with their risk tolerance and investment objectives.



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