EIC - OFS Credit: Now Even Better Than CLO Peers With Increased Monthly Dividend
2024-05-03 09:17:44 ET
Summary
- OCCI, a CEF from OFS Credit Company Inc, has outperformed peer CLO funds over the past 6 months, with a total return of nearly 25%.
- The fund offers a DRIP discount to entice shareholders to reinvest their monthly distributions and increase AUM.
- OCCI holds about 70% CLO equity and 25% CLO debt.
- Core NII more than covers the recently raised monthly distribution, which now offers a yield of about 18%.
In my recent article explaining how the 19% yield offered by Oxford Lane Capital (OXLC) is easily covered by core NII , many readers commented about the perceived risk of CLOs and asked how can such performance be sustained. In this review of the CEF from OFS Credit Company Inc (OCCI), I am going to explain that the performance over the past 6 months has been even better than peer CLO funds OXLC, [[ECC]], and [[EIC]]. And I believe going forward that outperformance is likely to continue as OCCI grows the fund AUM and raised the monthly distribution by 5% for May, June, and July. Also, note that to further increase the number of shares purchased by investors and to grow AUM even more, the fund now offers a DRIP discount to entice shareholders to reinvest their monthly distributions....
OFS Credit: Now Even Better Than CLO Peers With Increased Monthly Dividend