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chollida1 • yesterday at 7:30 PM • 1 reply • view on HN

> Yeah, it's rarely not fixed, and a lot was tied to the historic expectation of the investment being at most ~5-7 years.

You've got it reversed, the debt BDC's and PC firms write is usually floating rate based off SOFR. That' s why they do so well in rising rate environments.

Now they often borrow at fixed rates by issuing bonds or preferred shares that pay a fixed rate so falling rates has to opposite effect on them.


Replies

lesuorac • today at 12:46 AM

I mean if your borrowers go bankrupt then its bad for you.