BDCs & private-credit income

Claim

Nine BDCs screened in April against a difficult 2026 macro backdrop — the "private credit panic," with BDC secondary sales down 40% as default shadows lengthened. July refreshed the field and added TRIN, TSLX, CSWC.

The framework (§4 of analysis_notes.md) is unusually well-specified for this type, and the screens applied it: Price/NAV · base dividend coverage ≥100% · variable-rate debt ≤90% · TBVPS 5yr CAGR · Price/TBVPS.

Held: ARCC (1 share @ $18.43, Schwab) — the position that triggered the April peer screen. Own reports exist for TSLX, OBDC, MAIN.

The thing to carry forward

In a credit-stress environment yield is an anti-signal: the highest yields in the group belonged to the names whose coverage was deteriorating. Base dividend coverage and non-accrual trend do the real work, and a BDC screen sorted by yield is sorted backwards.

What would falsify this

Default rates normalising without the sector's discounts closing — which would suggest the discounts were pricing something other than credit and the coverage filter was solving the wrong problem.

Related

[[reits]] — same income sleeve, same rate dependency, same missing macro view.

History

• 2026-04-08 — nine-BDC peer screen triggered by the ARCC holding.
• 2026-07-14 — refresh; TRIN/TSLX/CSWC added.