Ares Capital vs Sprott Physical Gold Trust
Ares Capital vs Sprott Physical Gold Trust compares two distinct publicly traded entities. This page examines their business models, financial performance, and market context in a neutral, accessible way. It presents contextual information to help readers understand similarities and differences without advice or recommendations. Educational content, not financial advice.
Ares Capital vs Sprott Physical Gold Trust compares two distinct publicly traded entities. This page examines their business models, financial performance, and market context in a neutral, accessible ...
Which Baskets Do They Appear In?
Wall Street's Private Credit Push
This carefully selected group of stocks represents companies positioned to benefit from the major shift toward private credit on Wall Street. Professional investors have identified these Business Development Companies as potential winners from JPMorgan's strategic move into alternative lending, which could drive new partnerships and increased deal flow.
Published: July 15, 2025
Explore BasketWhich Baskets Do They Appear In?
Wall Street's Private Credit Push
This carefully selected group of stocks represents companies positioned to benefit from the major shift toward private credit on Wall Street. Professional investors have identified these Business Development Companies as potential winners from JPMorgan's strategic move into alternative lending, which could drive new partnerships and increased deal flow.
Published: July 15, 2025
Explore BasketInvestment Analysis
Ares Capital
ARCC
Pros
- Largest publicly traded business development company by market capitalization as of September 2025, providing scale and market presence.
- Strong portfolio with $27.9 billion fair value invested across 566 companies, reflecting diversified exposure and risk management.
- Attractive dividend yield of around 9.6%, supported by consistent earnings and recent dividend declarations of $0.48 per share.
Considerations
- Exposure concentrated in first lien senior secured loans, could face credit risk during economic downturns or rising interest rates.
- Portfolio and performance subject to middle-market company credit cycles, introducing potential volatility based on economic conditions.
- Relatively low beta (~0.62), which may limit upside participation in strong equity markets, reflecting moderate sensitivity to market trends.
Pros
- Invests primarily in physical gold bullion, providing a secure, tangible asset exposure and effective inflation hedge.
- Market capitalization over $14 billion with holdings exceeding 3.7 million ounces of gold, indicating substantial scale and liquidity.
- Long-term holding strategy with low management expense ratio around 0.39%, enhancing cost efficiency for investors.
Considerations
- Closed-end structure trading at a discount of approximately 2.5% to net asset value, potentially limiting immediate capital appreciation.
- Returns closely tied to gold price volatility, which may fluctuate significantly due to macroeconomic factors and market sentiment.
- No direct income or dividends as returns depend entirely on price appreciation of gold, limiting cash flow generation for investors.
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