Highland Income Fund

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SEC Filings
  • A publicly listed closed-end fund offering high income potential in all markets
  • Yields that reset when short-term interest rates move, which may mitigate price declines in a rising short-term interest rate environment
  • Low correlation to other asset classes
  • Access to one of the largest and most experienced senior loan managers

Fund Materials

Fund Overview

Investment Objective

The investment objective of the closed-end Highland Income Fund is to provide a high level of current income, consistent with the preservation of capital.

Attractive Alternatives for Income-Oriented Investors
  • High income potential in all markets
  • Yields that reset when short-term interest rates move, which may mitigate price declines in a rising short-term interest rate environment
  • Low correlation to other asset classes
  • Access to one of the largest and most experienced senior loan managers
  • Most fixed rate securities experience price declines when interest rates rise. Floating Rate Senior loans are different.

They are short-duration, floating-rate securities. So, as interest rates rise, yields on bank loans increase, while their short duration helps keep prices relatively stable

Fund NAV (As of Jul 06, 2020)
SymbolHFRO
Inception01/13/00
NAV$12.44
As of 06/30/2020 NAVMarket Price
Year To Date-6.44%-31.87%
One Year-6.90%-36.55%
Three Year0.15%-12.99%
Five Year2.30%-5.95%
Ten Year4.77%0.45%
Since Inception3.45%1.35%

The Fund converted to a close-end fund on 11/3/2017.

Portfolio Managers

James Dondero, CFA

President, Co-Founder

Bio

Jon Poglish, CFA

Head of Credit Research

Bio

Press Releases

Highland Income Fund Announces the Regular Monthly Dividend

DALLAS, June 1, 2020 /PRNewswire/ — Highland Income Fund (NYSE: HFRO) (“HFRO” or the “Fund”) today announced its regular monthly dividend on its common stock of $0.0770 per share. The dividend will be payable on June 30,…

Highland Income Fund Announces the Regular Monthly Dividend

DALLAS, May 14, 2020 /PRNewswire/ — Highland Income Fund (NYSE: HFRO) (“HFRO” or the “Fund”) today announced its regular monthly dividend on its common stock of $0.0770 per share. The dividend will be payable on May 29,…

Highland Income Fund Announces the Regular Monthly Dividend

DALLAS, May 1, 2020 /PRNewswire/ — Highland Income Fund (NYSE: HFRO) (“HFRO” or the “Fund”) today announced its regular monthly dividend on its common stock of $0.0770 per share. The dividend will be payable on May…

Other Forms, Filings, and Literature

 

The performance data quoted here represents past performance and is no guarantee of future results. Investment returns and principal value will fluctuate so that an investor’s shares when redeemed may be worth more or less than their original cost. Current performance may be lower or higher than performance data quoted.

 

Effective shortly after close of business on November 3, 2017, the Highland Floating Rate Opportunities Fund converted from an open-end fund to a closed-end fund, and began trading on the NYSE under the symbol HFRO on November 6, 2017. The performance data presented above reflects that of Class Z shares of the Fund when it was an open-end fund, HFRZX. The closed-end Fund pursues the same investment objective and strategy as it did before its conversion.

The expense ratio shown is updated monthly and is accurate as of 02/28/2020

Closed-end funds, unlike open-end funds, are not continuously offered. There is a one-time public offering and once issued, shares of closed-end funds are sold in the open market through a stock exchange and frequently trade at prices lower than their net asset value, which may increase an investor’s risk of loss. Net Asset Value (NAV) is total assets less total liabilities, which includes preferred shares, divided by the number of common shares outstanding. At the time of sale, your shares may have a market price that is above or below NAV, and may be worth more or less than your original investment. For additional information, please contact your investment adviser or visit our website www.highlandfunds.com.

Please consider the investment objectives, risks, charges and expenses of Highland Floating Rate Opportunities Fund carefully before investing. A prospectus with this and other information about Highland Floating Rate Opportunities Fund can be found on the Literature tab above.

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 effected.

Non-Payment Risk. Senior Loans, like other corporate debt obligations, are subject to the risk of non-payment of scheduled interest and/or principal. Non-payment 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.

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 Highland 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.

Senior Loans Risk. The risks associated with senior loans are similar to the risks of below investment grade securities in that they are considered speculative. In addition, as with any debt instrument, senior loans are also generally subject to the risk of price declines and to increases in prevailing interest rates. Senior loans are also subject to the risk that, as interest rates rise, the cost of borrowing increases, which may also increase the risk and rate of default. In addition, the interest rates of floating rate loans typically only adjust to changes in short-term interest rates; long term interest rates can vary dramatically from short term interest rates. Therefore, senior loans may not mitigate price declines in a rising long-term interest rate environment.

Illiquidity of Investment 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 diffiulties of Agents can pose a risk to the Fund.

Glossary: Click for important terms and definitions

Source: SEI Investments Global Funds Services