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BlackRock Capital Investment Co Message Board

  • jadelover888888888 jadelover888888888 Apr 18, 2013 4:13 PM Flag

    You should probably sell BKCC right now

    and buy it back later....

    Of far, there are 14 trading days in April and Virginia Retirement System dumped their BKCC shares on the market in 11 of them:
    http://finance.yahoo.com/q/it?s=BKCC+Insider+Transactions

    At today's closing price of 9.29, it is right at its recent NAV, with a 11.19% yield, the problem is with this continued dumping of BKCC shares by VRS into the market, and with the BDC sector going SOUTH, the possibility of BKCC's going up in price in the next 3 months, IMHO, is NONE.

    Therefore, I believe you would be much better off to sell all your BKCC shares NOW, use the proceeds to buy other BDCs such as: PSEC or TICC, which are both being traded below their recent NAVs and with higher yields. Or buy a safer one (lower yield) such as PFLT. For long term, buy PPR, a floating CEF, which went up in the last two days when the general market tanked.

    Of course, I can be wrong and BKCC will shoot up in price.

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    • On 4/11/13, I warned you of the downside risk of BKCC due to the massive dumping of shares by VRS. On that day, BKCC closed at 9.78. Only one week later, today it closed at 9.29, that means BKCC so far was down 5% since last Thursday. You can blame it one the overall market but I really believe until VRS settles downs in their massive dumping, BKCC will fare much worse than many other BDCs in the next 3 months. Even at today's closing price, its yield is 11.19%, if you deduct the 5% drop in its share price, you are really only getting a 6.19% yield. PFLT right now pays you a 7.53% yield. Although it is managed by PNNT, a BDC, it is really a floating capital (like a CD with floating interest rate which means it will go up higher when interest rate goes up). It dropped 1.27% and closed at 13.95. If it drops to or below 13.70, it will be a great entry price. This one should fare better than most BDCs, of course you really should not compare it with BDCs, but rather with other floaters. Of course, when the overall market tanks, it will tank also. Therefore, you must decide what you want to do. Currently I DO NOT own any BKCC because it is too risky a BDC to hold for long term. I will trade it if it drops sharply in any one trading day. I like TICC, FSC, PSEC and GAIN beside PFLT.

 
BKCC
8.6699-0.1101(-1.25%)10:48 AMEDT