Actually the warning should be:
The no. 1 goal of the management is to maximize their fees and bonuses by decreasing the NAV of the stock and keep making new investments from borrowing more money and issuing more new shares.
The no. 2 goal is to continue in increasing the monthly dividend by 1/100 penny at a time so that they can brag they have been continuing in the increase of dividend. They will continue to pay this dividend even though their NII may not be able to cover it and have to use their principal to pay for it, therefore further reducing its NAV.
The no. 3 goal is to keep issuing more new shares either via ATM or SPOs and issue more and more senior convertible notes so that their portfolio will keep expanding which will result in a continued flow of bonuses and fees.
I just did a quick research, using today's closing price (5/14/13):
PSEC 10.93 KCAP 11.17
Five years ago, their adjusted close prices:
5/15/2008 PSEC 8.34 KCAP 5.72
That means if you bought both five years ago, hold it till today:
Total return: PSEC 31.06% KCAP 95.28%
Annual return: PSEC 6.21% KCAP 19.06%
(*For you pumpers, to hold PSEC for five years with only a 6.21% annual return despite its high yield.
Goodness, you all must be easily satisfied. LOL)