Top 10 Reasons to Invest in BDCs
Top 10 Reasons to Invest in Business Development Companies
January 15, 2010 by Nicholas Marshi on Seeking Alpha
We thought readers might find interesting our Top Ten Reasons to invest in the relatively unknown world of Business Development Companies (BDC).
1. Required To Pay Regular Dividend Pay-outs
BDCs are required by the Investment Act of 1940 to distribute a minimum of 90% of their taxable earnings quarterly to maintain their one-level tax paying status. In practice, most BDCs pay out to their shareholders 98% of taxable income and all short term capital gains, and some pay out to shareholders all long term capital gains received from the sale of equity interests in portfolio companies. Many BDCs even pay-out their dividends monthly. Read more.