- Lots of funds are cheap these days and paying high distribution yields, but Eagle Point Income represents a better bargain than many other funds because it is not as well understood.
- EIC is safer than many high yield bond funds because of the unique characteristics of CLO junior debt, with its unusually low default history, yet perceived riskiness by many investors.
- Because CLOs are viewed as complex and kind of funky by some institutional investors, they have to pay higher rates than more mainstream asset classes with equivalent risk.
- With the recent sell-off, EIC's distribution (raised again last month) now represents a 9.3% yield, higher than many riskier high-yield funds.
For further details see:
Eagle Point Income: A Unique Value In Our Current Environment