Nov. 19 at 2:42 PM
$BIZD Why Risks may be increasing:
• Private credit is late cycle; if we see higher defaults, risk premiums widen, valuations drop...
$BIZD is directly exposed.
• Rising interest rates + tighter liquidity: Middle-market borrowers often have floating rate exposure, covenant risk, weaker balance sheets...macro slows and refinancing becomes harder, defaults rise.
• Illiquidity & valuation gaps: The underlying portfolio may mark lower, but public BDC prices may lag;
$BIZD may mark its holdings down, reducing NAV.
• High yield under stress: The attractive yield is compensation for risk; if underlying assets lose value, yield may not be sustainable...yields will shrink, hurting total return.
• ETF structure amplifies risk:
$BIZD may be subject to redemptions or trading-related issues if sentiment sours. In a stress episode, bid-ask spreads may widen, and liquidity may evaporate.
