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Bought Some OFS Credit Term Preferred

I bought shares of CLO Owner OFS Credit 5.25% term preferred (OCCIN). While the coupon is rather low the yield to maturity is pretty good at just under 8% (maturity is 12/31/2026).

OFS is a rather small closed end fund–just $240 million in assets. They use term preferreds as their sole leverage. Their asset coverage is near 2.61 times (as of 10/31/2024)-which is a bit lighter than I would like, but adequate–of course I always watch coverage ratios closely. Their most recent report can be read here.

This yield to maturity is a good step up in return from those issues I sold earlier today–I expect it will work well and should arrest some of my capital losses (of course nothing is 100%).

Now on to see where I might do some more swapping of low coupon issues out for higher total return issues.

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