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Highland Opportunities and Income Fund Announces the Regular Monthly Distribution

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Highland Opportunities and Income Fund (HFRO) declares a monthly distribution of $0.0385 per share, payable on March 28, 2024, to shareholders of record as of March 21, 2024. The Fund aims for capital growth and income through various investments, including real estate, fixed-rate loans, corporate bonds, equities, and more.
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The announcement by Highland Opportunities and Income Fund (HFRO) regarding its regular monthly distribution of $0.0385 per share is a critical piece of information for current and potential investors. This distribution rate provides insight into the fund's yield, which is a key determinant of the investment's attractiveness, particularly for income-focused investors. The yield, calculated as the annual distribution divided by the share price, serves as a benchmark for comparing the income-generating potential of HFRO against other investment opportunities.

Investors often evaluate such funds based on their distribution consistency and the underlying assets' ability to support these payouts. HFRO's investment strategy, which includes a mix of real estate securities, corporate bonds and floating rate loans, among others, suggests a diversified approach aimed at balancing growth and income. The fund's performance, in terms of both capital appreciation and income generation, would need to be analyzed in the context of current market interest rates and the real estate market's health, as these factors can significantly impact the value and stability of the fund's holdings.

Moreover, the recent adjustment of the monthly distribution rate in January 2024 indicates that the fund is actively managed to align with its portfolio performance and investment objectives. This could be seen as a positive sign of responsive fund management, but it also necessitates a close examination of the fund's portfolio to understand the drivers behind this adjustment. A change in distribution can sometimes signal shifts in the underlying asset values or the management's outlook on future earnings.

From a market research perspective, the announcement by HFRO is an event that can influence investor sentiment towards closed-end funds. The ability of HFRO to maintain or adjust its distributions reflects its market positioning and competitive landscape. Closed-end funds like HFRO are often compared based on their distribution rates, portfolio diversity and risk management strategies.

The fund's focus on a combination of real estate-related securities and other financial instruments, such as structured products and floating rate loans, indicates an attempt to tap into various sources of income while potentially mitigating risk through diversification. This strategy may appeal to investors looking for exposure to different market segments through a single investment vehicle.

Additionally, the fund's emphasis on both direct and indirect investments, including the use of derivatives, is a noteworthy strategy. Derivatives can be used to hedge against market volatility or to gain exposure to certain assets without directly owning them, which can enhance the fund's flexibility in managing its portfolio. However, this also adds a layer of complexity and potential risk that investors need to consider, as derivatives can lead to amplified losses in adverse market conditions.

An economist would examine the broader economic implications of HFRO's distribution announcement. The fund's investment in a variety of instruments, including real estate and floating rate loans, indicates it is positioned to capitalize on certain economic conditions, such as stable or increasing property values and potentially rising interest rates. Floating rate loans, in particular, can be attractive during periods of interest rate volatility, as they typically offer interest payments that adjust with market rates, potentially providing a hedge against inflation.

However, the overall economic environment must be considered, as it affects the performance of the assets within HFRO's portfolio. For instance, an economic downturn could lead to a decrease in real estate values and an increase in the default rates of corporate bonds and loans. Such conditions would challenge the fund's ability to maintain its distribution rate and could impact its share price.

The fund's strategy to invest in distressed securities and structured products further indicates a willingness to engage in higher-risk investments, which could lead to higher returns but also increases the fund's exposure to economic downturns. Investors must weigh these risks against the potential for higher income in the context of their own investment goals and the current economic climate.

DALLAS, March 1, 2024 /PRNewswire/ -- The Highland Opportunities and Income Fund (NYSE: HFRO) ("HFRO" or the "Fund") today announced its regular monthly distribution on its common stock of $0.0385 per share. The distribution will be payable on March 28, 2024, to shareholders of record at the close of business March 21, 2024.

The Fund is a closed-end fund that seeks to provide growth of capital along with income in a registered fund format. The Fund pursues its investment objective by investing directly and indirectly (e.g., through derivatives that are the economic equivalent of direct investments) in the following categories of securities and instruments: (i) investments in securities or other instruments directly or indirectly secured by real estate, including real estate investment trusts ("REITs"), preferred equity, securities convertible into equity securities and mezzanine debt; (ii) other instruments, including, but not limited to, secured and unsecured fixed-rate loans and corporate bonds, distressed securities, mezzanine securities, structured products (including but not limited to mortgage-backed securities, collateralized loan obligations and asset-backed securities), convertible and preferred securities, equities (public and private), and futures and options; and (iii) floating rate loans and other securities deemed to be floating rate investments.

The Fund declares and pays distributions monthly.

On January 4, 2024, the Fund adjusted the monthly distribution rate to align the distribution with the Fund's current portfolio and investment objective. Additional information on the distribution can be found on the Fund's website at http://www.nexpointassetmgmt.com/opportunities-income-fund.

About the Highland Opportunities and Income Fund

The Highland Opportunities and Income Fund (NYSE: HFRO) is a closed-end fund managed by NexPoint Asset Management, L.P. For more information visit nexpointassetmgmt.com/opportunities-income-fund.

Effective June 15, 2023, the Fund changed its name to the Highland Opportunities and Income Fund to reflect a new investment objective. Under the modified investment objective, the Fund will pursue growth of capital along with income. More information can be found in the press release announcing the changes, issued on May 16, 2023.

About NexPoint Asset Management, L.P.

NexPoint Asset Management, L.P. is an SEC-registered investment adviser. It is the adviser to a suite of registered funds, including open-end mutual funds, closed-end funds, and an exchange-traded fund. For more information visit nexpointassetmgmt.com.  

Investors should consider the investment objectives, risks, charges, and expenses of the Highland Opportunities and Income Fund carefully before investing. This and other information can be found in the Fund's prospectus, which may be obtained by calling 1-800-357-9167 or visiting nexpointassetmgmt.com. Please read the prospectus carefully before you invest.

The distribution may include a return of capital. Please refer to the 19(a)-1 Source of Distribution Notice on the NexPoint Asset Management website for Section 19 notices that provide estimated amounts and sources of the Fund's distributions, which should not be relied upon for tax reporting purposes.

No assurance can be given that the Fund will achieve its investment objectives.

Shares of closed-end investment companies frequently trade at a discount to net asset value. The price of the Fund's shares is determined by a number of factors, several of which are beyond the control of the Fund. Therefore, the Fund cannot predict whether its shares will trade at, below or above net asset value. Past performance does not guarantee future results.

Closed-End Fund Risk. The Fund is a closed-end investment company designed primarily for long-term investors and not as a trading vehicle. No assurance can be given that a shareholder will be able to sell his or her shares on the NYSE when he or she chooses to do so, and no assurance can be given as to the price at which any such sale may be affected.

Credit Risk. The Fund may invest all or substantially all of its assets in Senior Loans or other securities that are rated below investment grade and unrated Senior Loans deemed by NexPoint to be of comparable quality. Securities rated below investment grade are commonly referred to as "high yield securities" or "junk securities." They are regarded as predominantly speculative with respect to the issuing company's continuing ability to meet principal and interest payments. Non-payment of scheduled interest and/or principal would result in a reduction of income to the Fund, a reduction in the value of the Senior Loan experiencing non-payment and a potential decrease in the NAV of the Fund. Investments in high yield Senior Loans and other securities may result in greater NAV fluctuation than if the Fund did not make such investments.

Real Estate Industry Risk: Issuers principally engaged in real estate industry, including real estate investment trusts, may be subject to risks similar to the risks associated with the direct ownership of real estate, including: (i) changes in general economic and market conditions; (ii) changes in the value of real estate properties; (iii) risks related to local economic conditions, overbuilding and increased competition; (iv) increases in property taxes and operating expenses; (v) changes in zoning laws; (vi) casualty and condemnation losses; (vii) variations in rental income, neighborhood values or the appeal of property to tenants; (viii) the availability of financing and (ix) changes in interest rates and leverage.

Illiquidity of Investments Risk. The investments made by the Fund may be illiquid, and consequently the Fund may not be able to sell such investments at prices that reflect the Investment Adviser's assessment of their value or the amount originally paid for such investments by the Fund.

Ongoing Monitoring Risk. On behalf of the several Lenders, the Agent generally will be required to administer and manage the Senior Loans and, with respect to collateralized Senior Loans, to service or monitor the collateral. Financial difficulties of Agents can pose a risk to the Fund.

CONTACTS

Investor Relations

Kristen Thomas

IR@nexpoint.com

Media Relations

Prosek Partners for NexPoint

Pro-nexpoint@prosek.com

Cision View original content:https://www.prnewswire.com/news-releases/highland-opportunities-and-income-fund-announces-the-regular-monthly-distribution-302077571.html

SOURCE Highland Opportunities and Income Fund

Highland Opportunities and Income Fund (HFRO) declared a monthly distribution rate of $0.0385 per share.

The declared distribution will be payable on March 28, 2024, to shareholders of record as of March 21, 2024.

Highland Opportunities and Income Fund (HFRO) seeks to provide growth of capital along with income through investments in various categories of securities and instruments.

Additional information on the distribution can be found on the Fund's website at http://www.nexpointassetmgmt.com/opportunities-income-fund.
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