How Non-Traded BDCs Work
Non-traded BDCs combine the capital of investors to finance and, in certain instances, participate in the economic upside of a portfolio of businesses. These companies intend to pass on earnings or interest payments to the non-traded BDC, which are used to pay monthly distributions1 to investors.
1) There is no guarantee that a BDC will be able to pay distributions. Distributions may be paid from sources other than income generated from the BDC’s investments.