Should You Forget Realty Income and Buy a BDC Instead?

Realty Income (REIT) has underperformed the S&P 500 over the past decade due to share dilution and vulnerability to rising interest rates. Business Development Corporations (BDCs) like Ares Capital may be better income investments as they benefit from higher interest rates, offering yields of 10.3% versus Realty Income's 5.8%. However, both asset classes distribute most earnings as dividends, limiting long-term compound growth potential.