- Who can blame OCCI for wanting to compete with the big kids in the CLO fund world, Eagle Point Credit and Oxford Lane Capital?
- So its 15% distribution yield tops the charts and looks pretty impressive.
- Until you read the fine print and see it's really a 3.75% cash payout and the rest is stock that can only be turned into cash by diluting your holding.
- NII coverage for the theoretical 15% payout is a paltry 54%, way below its competitors.
- If OCCI labeled its payout as 3.75%, coverage would be an impressive 271%; but how many investors would choose that, with the option a real 10% from ECC or OXLC?
For further details see:
OFS Credit's Phantom 15% Distribution Yield