Prospect Capital (PSEC)

Prospect Capital typically invests in private companies through senior secured debt, subordinated debt, structured credit, and selected equity positions. Its capital may be used to support acquisitions, recapitalisations, growth initiatives, ownership transitions, or balance-sheet refinancing. The company can invest directly in operating businesses as well as through sponsor-backed transactions involving private equity firms.

In addition to corporate lending, Prospect Capital has exposure to areas such as real estate-related investments, syndicated loans, and collateralised loan obligation strategies. This diversified approach gives the company access to multiple segments of the private credit market, although it also exposes shareholders to credit cycles, interest-rate movements, and the performance of underlying borrowers.

As a regulated investment company and business development company, Prospect Capital distributes a significant portion of its taxable income to shareholders. Its role in the market is to provide non-bank financing to companies that may not have easy access to traditional public capital markets, while offering public-market investors a way to participate in private credit and middle-market lending.