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BDC Income ETF Hit a 52-Week High
For investors seeking momentum, Putnam BDC Income ETF (PBDC) is probably on the radar. The fund just hit a 52-week high and is up 21.3% from its 52-week low price of $28.77/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:
PBDC In Focus
This ETF is active and does not track a benchmark. The Putnam BDC ETF seeks current income. The fund charges 679 bps in fees and yields 9.07% annually.
Why the Move?
In a high-rate environment (which we are witnessing currently), business development companies can potentially generate higher interest income on their loan portfolios, which could boost their overall revenues. BDCs can actively manage their portfolios to adapt to changing interest rate conditions.
They might adjust the duration and composition of their investments to optimize their returns. Some BDCs may choose to diversify their investment strategies to include floating-rate loans or other assets that can benefit from rising interest rates.
More Gains Ahead?
PBDC might remain strong, given a positive weighted alpha of 20.81. As a result, there is still some promise for risk-aggressive investors who want to ride on this surging ETF.