DALLAS, Nov 01, 2021 (GLOBE NEWSWIRE) – Highland Income Fund (NYSE: HFRO) (“HFRO” or the “Fund”) today announced its regular monthly distribution on its common shares of $ 0.0770 per share . The distribution will be payable on November 30, 2021 to shareholders of record at the close of business on November 23, 2021.
The Fund is a closed-end fund managed by Highland Capital Management Fund Advisors, LP (the “Manager”). The Fund will pursue its investment objective by investing primarily in the following categories of securities and instruments: (i) variable rate loans and other securities considered to be variable rate investments; (ii) investments in securities or other instruments guaranteed directly or indirectly by real estate (including real estate investment trusts (“REITs”), preferred stocks, securities convertible into equity securities and debt mezzanine); and (iii) 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, guaranteed loan bonds and asset-backed securities), convertible and preferred securities, stocks (public and private), and futures and options. The investment objective of the Fund is to provide a high level of current income consistent with preservation of capital in a registered fund format. The Fund declares and pays distributions of investment income on a monthly basis.
About Highland Income Fund
The Highland Income Fund (NYSE: HFRO) is a closed-end fund managed by Highland Capital Management Fund Advisors, LP. For more information visit www.highlandfunds.com/ Income-fund /
About Highland Capital Management Fund Advisors, LP
Highland Capital Management Fund Advisors, LP is an SEC registered investment adviser. He is the advisor to a range of registered funds, including open-end mutual funds, closed-end funds and an exchange-traded fund. For more information, visit www.highlandfunds.com.
Investors should carefully consider the investment objectives, risks, fees and expenses of the Highland Income Fund before investing. This and other information can be found in the Fund’s prospectus, which can be obtained by calling 1-800-357-9167 or by visiting www.highlandfunds.com. Please read the prospectus carefully before investing.
With effect shortly after the close of business on November 3, 2017, Highland Floating Rate Fund changed from an open-ended fund to a closed-end fund and began trading on the New York Stock Exchange under the symbol HFRO on November 6, 2017. The performance data presented above for the periods prior to November 3, 2017 reflects that of the Class Z shares of the Fund when it was a variable capital fund, HFRZX. The closed-end fund pursues the same objective and the same investment strategy as before its conversion. The expense ratio is that of the Class Z shares of the Fund prior to its conversion.
The distribution may include a return of capital. Please refer to Notice 19 (a) -1 on the Source of Distribution on the Highland Funds website for the Section 19 notices which provide the estimated amounts and sources of the Fund’s distributions, on which it is not should not be relied on for tax reporting purposes.
No guarantee can be given that the Fund will achieve its investment objectives.
The shares of closed-end investment companies frequently trade at a discount to the net asset value. The price of shares in the Fund is determined by a number of factors, many 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 is no guarantee of future results.
Risk associated with closed-end funds. 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 their shares on the NYSE when they choose to do so, and no assurance can be given as to the price at which such a sale might be affected.
Credit risk. The Fund may invest all or substantially all of its assets in senior loans or other securities rated below investment grade and unrated senior loans that Highland deems to be of comparable quality. Securities rated below investment grade are commonly referred to as “high yield securities” or “junk securities”. They are considered primarily speculative with respect to the continued ability of the issuing company to meet principal and interest payments. Failure to pay expected interest and / or principal would result in a reduction in the Fund’s income, a reduction in the value of the Senior Loan in default and a potential decrease in the NAV of the Fund. Investments in senior high yield loans and other securities may cause the net asset value to fluctuate more than if the Fund had not made such investments.
Senior Loan Risk. The London Interbank Offered Rate (“LIBOR”) is the average rate offered for various maturities of short-term loans between the major international banks that are members of the British Bankers Association. LIBOR is the benchmark interest rate index most commonly used to adjust variable rate loans. It is used across the global banking and financial industries to determine interest rates for a variety of financial instruments (such as debt instruments and derivatives) and loan agreements. Due to allegations of manipulation in 2012 and reduced activity in financial markets it measures, in July 2017, the Financial Conduct Authority (the “FCA”), the UK’s financial regulator, has announced its intention to phase out the use of LIBOR by the end of 2021. Although the period from FCA’s announcement to the end of 2021 should generally be sufficient for market participants to switch to use of a different benchmark for new securities and transactions, there is uncertainty as to the future use of LIBOR and the specific replacement rate (s). Therefore, the potential effect of a transition out of LIBOR on the Trust or the financial instruments used by the Trust cannot yet be determined. The transition process may involve, among other things, increased volatility or illiquidity in the markets for instruments that currently depend on LIBOR. The transition may also result in a change in (i) the value of certain instruments held by the Trust, (ii) the cost of temporary borrowing to the Trust, or (iii) the efficiency of related Trust operations such as covers, if applicable. In the event that LIBOR is terminated, the LIBOR replacement rate may be lower than market expectations, which could negatively impact the value of preferred securities and variable coupon or fixed to variable coupon debt securities. Such effects of the abandonment of LIBOR, as well as other unforeseen effects, could result in losses to the Trust. Since the usefulness of LIBOR as a benchmark may deteriorate during the transition period, these effects may occur before the end of 2021.
Real Estate Sector Risk: Issuers primarily active in the real estate sector, including real estate investment trusts, may be subject to risks similar to the risks associated with direct ownership of real estate, including: (i) changes in general economic and market conditions; (ii) changes in the value of real estate; (iii) risks related to local economic conditions, overbuilding and increased competition; (iv) increase in property taxes and operating costs; (v) changes in zoning laws; (vi) losses and convictions; (vii) variations in rental income, neighborhood values or the attractiveness of the property for tenants; (viii) the availability of financing and (ix) the evolution of interest rates and indebtedness.
Risk of illiquidity of investments. Investments made by the Fund may be illiquid and, therefore, the Fund may not be able to sell such investments at prices which reflect the Investment Adviser’s assessment of their value or of the amount originally paid for such investments. investments by the Fund.
Risk of continuous monitoring. On behalf of more than one lender, the agent will generally be responsible for administering and managing senior loans and, with respect to senior secured loans, managing or monitoring the collateral. The financial difficulties of Agents may present a risk to the Fund.
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