Value, non-investment grade debt
Contributor Since 2007
Nicholas Marshi is the Editor of the BDC Reporter (www.bdcreporter.com), the leading online publication dedicated to the Business Development Company ("BDC") sector. The BDC Reporter is read by thousands of individual and institutional investors for its broad and incisive coverage of this $60bn segment of the financial sector. Since 2008, Mr Marshi has also been a frequent contributor to Seeking Alpha, penning hundreds of articles and blog posts. Mr Marshi is also the Chief Investment Officer of BDC Investment Advisors (BDCIA), a Registered Investment Adviser based in Los Angeles, California. BCIA manages investment portfolios, both for its own account and those of third parties, solely in the publicly traded securities of BDCs. Since 2009 SCM has also managed a "friends and family" investment fund focused on the BDC sector, which has recently opened up to third party accredited investors. Prior to forming BCIA, Mr. Marshi managed two private equity firms. Both firms were active in acquiring lower middle market private companies, principally in Southern California. Before getting into Private Equity, Mr Marshi was the head of the Los Angeles office of Kleinwort Benson Limited, a British merchant bank, from 1987-1990. Mr Marshi was involved in investment banking, lending and principal investing activities. At the outset of his career, Mr Marshi held various positions with Citibank at locations worldwide including Athens, Dubai, Puerto Rico and London. Mr Marshi is a graduate of Tufts University (B.A.) and Harvard University (M.A.).
August 5, 2013: We spent much of the day reading writing as there was very little activity in the market. The BDC ETN BDCS , which we use as a rough and ready proxy for the BDC sector, was down 0.41% on anemic volume.
1. We did review the Medallion Financial (TAXI) earnings, which were as expected. Likewise, the dividend was unchanged at $0.22 from the prior quarter. The stock was down 1.13% on the day. We have no position.
By the way, TAXI is the 12th BDC to report in this earnings season, suggesting we are at the one-third mark.
2. We have been the most impressed by the Fidus Investment (FDUS) and MCG Capital (MCGC) earnings releases so far, and increased our positions in both. FDUS is up 0.93% , and MCGC down 0.37% since their earnings releases. Mr Market obviously was not as positive as we were.
3. We wrote a posting in response to a blog that showed up on Yahoo Finance by "Sober Look" called "6 issues to consider when investing in BDCs". We used just the first point as a jumping off point about the difficulty of generalizing about anything where BDCs are concerned, and to point out that a BDC's costs and management fees, even if onerous, are not related to long term performance.
4. We wrote a "hot off the presses" posting about the drop in Solar Senior Capital (SUNS) stock price in mid-morning. The price was still down, but not as much by close. We speculated as to why the price was down by a bunch. We have no position, but are looking for an entry point.