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.