- Interest rate fears are creeping back into the market again and this article discusses a sector that will benefit.
- BDCs are currently yielding an average of 8.4% and higher interest rates will likely drive improved net interest margins and dividend increases.
- More importantly, BDC pricing will likely head higher before any rate increases similar to early 2016 outperforming REITs and the S&P 500.
- The buying has likely already started as BDCs have been rallying, but still have higher relative yields as discussed below.
For further details see:
Positioning Your Portfolio For Higher Interest Rates