Some are saying high-yield Business Development Companies could be the next big yield play, potentially rivaling real estate investment trusts. 

There are some similarities. Ares Capital Corporation (NASDAQ:ARCC) has an external management structure similar to what investors saw in the early age of REITs. But up and coming BDCs like Triangle Capital (NYSE:TCAP), Main Street Capital (NYSE:MAIN), and Hercules Technology Growth Capital (NYSE:HTGC) may have a better footing from which to benefit from the growth in the industry.

In the following video, Motley Fool Financials Bureau Chief David Hanson and Fool contributor Jordan Wathen discuss the potential for BDCs to eclipse REITs as the high-yield investment structure of choice for income investors.

 

Jordan Wathen has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.