5 High-Yield BDCs To Help You Invest Like The Wealthy

High-yield BDCs are a good way to invest like the rich.

Want to invest like the rich without shelling out much cash? Try business development companies. And start with these five high-yield BDCs.

Today, I want to tell you about high-yield BDCs (business development companies). But first, let’s talk about what’s happening in the market…

The stock market has been sensational over the last year and a half. The S&P 500 has rocketed over 90% from the March 2020 lows. That pace of rising prices simply can’t last. For rising stock prices, the easy money part is probably over.

But there are still some post-pandemic aberrations lying around in terms of yield. If you know where to look, you can find high yields that don’t often exist in normal environments. The party is still going on for high yields.

In fact, huge yields can still be had by investing like the rich.

As the saying goes, “The rich get richer and the poor get poorer.” This universally known American catchphrase perfectly encapsulates the pervasive attitude regarding class envy and wealth distribution in the American experience. And it does so in just a few words that everyone understands.

The saying is almost exclusively used as an expression of disgust or a cynical objection to the imperfections of society and the fact that the wealthy have advantages that most of us don’t. But the phrase, or the truth behind it, can actually be used constructively.  We can learn from the rich.

There are a lot of reasons why it’s easier to make more money if you already have money. But I will just focus on one undisputable fact: The rich have access to opportunities and investments that most of us do not.

Venture capital (VC) is a typical example of such privileged access. Venture capital, or private equity (PE), is money provided to young and growing businesses that otherwise wouldn’t have access to sufficient capital. This money is typically lent at very high rates of interest and/or in exchange for equity stakes (a percentage of ownership). (VC and PE do essentially the same thing except VC focuses primarily on taking equity stakes while PE uses a combination of equity and debt.)

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