InspereX BDC Disclaimer
InspereX LLC and its affiliates explicitly disclaim any responsibility for product suitability or suitability determinations related to individual investors. This information should not be regarded by recipients as a substitute for the exercise of their own independent judgment, and the information provided herein is not an offer, solicitation or a recommendation to buy, sell, or hold any security or investment strategy. There can be no assurance that the investments shown herein were or will be profitable, and this material does not take into account any investor’s particular investment objectives, financial situation, particular needs, strategies, tax status, or time horizon.
Investing in Business Development Companies (BDCs) involves a number of risks that investors should carefully consider. BDCs primarily invest in small and mid-sized private companies, including early-stage or financially distressed businesses, which may lack transparency and carry a higher risk of default or failure compared to larger public companies. Shares of BDCs are often illiquid, not traded on national exchanges, and may only be sold during limited liquidity windows, if at all, meaning investors should be prepared to hold their investment for an extended period. BDCs also frequently employ leverage, which can amplify both gains and losses and may increase volatility during adverse market conditions.
Distributions from BDCs may include return of capital, which is not derived from earnings and can reduce the BDC’s net asset value over time. Investors should not assume that distributions reflect income-generating performance. Past performance is no guarantee of future results. BDCs are typically managed by external advisers who charge management and incentive fees, which, along with other offering and servicing costs, can significantly reduce investor returns. There can be no assurance that a BDC will achieve its stated objectives. Public BDCs provide more comprehensive and frequent disclosures than privately offered BDCs, which may release only limited information. Because BDCs invest in illiquid, non-traded securities, valuations are often based on subjective estimates or third-party appraisals, which may not reflect actual market values and could impact reported performance and fees. Many portfolio companies also carry below-investment-grade or no credit ratings, making them more susceptible to default. Lastly, BDCs may concentrate investments in particular industries or issuers, increasing their exposure to sector-specific risks and reducing diversification benefits.
Investors should carefully read all of the BDC’s available information, including its registration statement, prospectus or private placement memorandum, as applicable, and any recent 10-Ks, 10-Qs, and 8-Ks. You can get this information by looking at the BDC’s filings in the SEC’s EDGAR database, from your investment professional, or directly from the BDC.
The information and strategies contained herein are strictly for illustrative and educational purposes and does not constitute an offer to sell or a solicitation of an offer to buy securities. Investment products described herein may not be offered for sale in any state or jurisdiction in which such as offer, solicitation, or sale would be unlawful or prohibited by the specific offering documentation.