osses From VII Peaks Co-Optivist Income BDC II?
Did you invest in VII Peaks Co-Optivist BDC II because of your broker or financial advisor? Apparently, this non-diversified closed-end company, which elects to be treated as a business development company (“BDC”), invests in equity-linked debt securities and discounted corporate debt securities of private and public companies, and makes distributions to investors. Currently, VII Peaks Capital, LLC is the BDC’s manager.
Evidently, VII Peaks Co-Optivist BDC II uses its proprietary Co-Optivist approach in executing an investment strategy designed to help its target companies restructure securities in anticipation of a redemption event such as a maturity or a put event. Supposedly, the BDC aims to generate capital appreciation and income. Apparently, in order to accomplish investment objectives, VII Peaks apparently realizes capital appreciation and income through acquiring, managing and liquidating corporate debt positions; distributing cash to shareholders; and by preserving shareholders’ capital investments.
VII Peaks Co-Optivist Income BDC II Offering Price, NAV
Evidently, SEC filings indicate that the public offering price of VII Peaks Co-Optivist BDC II started at $10.15 per share. On August 8, 2014, the Pricing Committee for the BDC’s Board of Directors reduced the share price for new investments to $10.00 per share. It appears that the Committee reduced the share price to $9.75 in November 2014; $9.25 in November 2015; and $8.75 in May 2016.
Notably, VII Peaks’ indicated that the BDC’s price decreases in 2014 and 2015 were due to the net asset value of the fund’s common stock being reduced. The BDC cites high yield debt prices declining; declines in specific positions that have possibly defaulted or restructured; and distributions exceeding net investment income. Evidently, as of year end December 2017, the net asset value per share is $5.31; ratio of net investment to average net assets is 3.90%; and turnover ratio is 17.65%.
Non-Traded BDC Suitability Concerns
Non-traded BDCs like VII Peaks Co-Optivist BDC II are generally inappropriate for investors with limited experience, low risk tolerances or liquidity needs. Mainly, investors holding non-traded BDCs may encounter difficulty selling shares quickly enough in volatile market conditions. Also, it may not be possible for investors to liquidate their non-traded BDCs.
Unfortunately, some securities brokers fail to disclose all the risks of BDCs or assess whether they are suitable for investors. Financial professionals are required to inform investors of all important investment information, such as illiquidity risks. Brokers can only recommend those investments which match their clients’ investor profiles. For this reason, investors who purchased unsuitable or misrepresented BDCs from their broker or financial advisor may be able to recover their losses.
Did Your Broker Or Advisor Inappropriately Sell You VII Peaks Co-Optivist Income BDC II?
Did you experience losses by investing in VII Peaks Co-Optivist Income BDC II? If so, contact Soreide Law Group at (888) 760-6552. Speak with experienced counsel about a possible recovery of your investment losses. Soreide Law Group represent clients on a contingency fee basis and advances all costs. The firm has recovered millions of dollars for investors who have suffered losses due to misconduct of brokers and brokerage firms.