Hilton Capital Management Launches Hilton BDC Corporate Bond ETF Tracking Solactive Hilton Capital BDC Corporate Bond TR Index
Solactive is pleased to announce its inaugural collaboration with Hilton Capital Management LLC, culminating in the launch of the Solactive Hilton Capital BDC Corporate Bond TR Index. This first-of-its-kind index offers targeted exposure to fixed-income securities issued by U.S.-registered Business Development Companies (BDCs), aiming to provide investors with access to elevated yields within a regulated, investment-grade framework.
As investor interest in private credit continues to rise, BDC bonds present a compelling opportunity. These instruments consistently yield above average Baa-rated corporates[1], delivering attractive income potential while generally maintaining investment-grade credit ratings. Furthermore, U.S. regulations require BDCs to maintain asset coverage of at least 150%, safeguarding bondholders by constraining leverage and ensuring structural risk discipline. Notably, BDCs boast a flawless repayment track record across more than 25 years of public “baby bond” issuance[2][3], underlining their stability and reliability.
The Solactive Hilton Capital BDC Corporate Bond TR Index methodology leverages this stability and upside by focusing exclusively on fixed-coupon bonds issued by BDCs listed in the annual Business Development Company Report published by the U.S. Securities and Exchange Commission (SEC). To ensure liquidity and quality, eligible bonds must have a minimum outstanding amount of USD 250 million and be priced by a designated price provider. Securities such as floating-rate notes, convertibles, inflation-linked, municipal, structured, or perpetual bonds are excluded. To avoid over-concentration, the index imposes a 10% cap per issuer.
The Hilton BDC Corporate Bond ETF is listed on June 11th, 2025, on the Nasdaq with the ticker HBDC.
Timo Pfeiffer, Chief Markets Officer at Solactive, commented: “We are thrilled to launch our first joint index with Hilton Capital Management, marking a new chapter in our collaboration. By translating the distinct income characteristics and regulatory structure of BDC bonds into a transparent, rules-based index, we aim to provide investors with a new tool for gaining exposure to the BDC bond universe. Furthermore, it enables access to the dynamics of the private-credit market through a well-regulated and transparent structure.”
Alex Oxenham, Chief Investment Officer at Hilton Capital Management, commented: “We’re excited to partner with Solactive on the Solactive Hilton Capital BDC Corporate Bond TR Index, a first-of-its-kind benchmark that passively seeks to unlock the yield premium of senior unsecured BDC bonds within a transparent, rules-based framework. By enforcing strict eligibility filters—$250 million minimum issue size, 10% issuer caps, and quarterly rebalancing—we’ve created an ETF-ready vehicle offering daily liquidity and broad diversification across leading BDC issuers. This collaboration transforms an overlooked corner of the credit market into a scalable solution for insurers, pension funds, and income-focused investors seeking private credit exposure.”
[1] KBRA Releases Research – Private Credit: Business Development Company (BDC) Ratings Compendium: First-Quarter 2025
[2] Prospect Capital Repays March 2025 Bond and Achieves Track Record of $4.7 Billion in Cumulative Principal Bond Repayments During More Than 20 Year History
[3] List of Baby Bonds and Related Information – Exchange Traded Debt