ContraryDude (23.94)

Why I'm buying BDCs

September 30, 2011 – Comments (2) | RELATED TICKERS: GAIN , AINV

With the recent market correction and new 52-week lows and the possiblity of further downside looking more and more likely, why would I be adding stocks now? 

I added some shares to my IRA of AINV.  Here is a snippet from a recent SA article:

Apollo Investment Corporation (AINV)

Yield: 15.05% Share Price (9/28): 7.98 52 Week Range: 7.17 – 12.46 Share Price down 17.73% since 7/22

Not much could be better for AINV than a recession. As more companies fall on temporary hard times, it allows AINV to be more selective and diverse in the companies it chooses to invest in or make loans to. A recession can be great news for a company like AINV, so there is no reason it should be trading at this much of a discount.

I also like GAIN, which pays a monthly dividend.  Here is some info on from another SA article:

After each company's name, I list the symbol, Friday's closing price, the 52 week high, the current dividend yield and the price/NAV ratio.

1. Gladstone Investment (GAIN)(6.89)(8.55)(9%)(.74) - GAIN has no net debt and has had a fair amount of insider buying of late. Its assets include some preferred stock and a small amount of common stock but these positions could be written down substantially before GAIN's book value would decline enough to equal its market cap. So you are not really paying for the preferred and common stock. The company is well managed and has been increasing NAV.

Any other good bargains out there for long-term investors?