High-Yield Trap: Oxford Square Capital’s 22% Dividend Raises Sustainability Concerns

For income-focused investors, Oxford Square Capital presents a compelling yet contradictory picture. The company offers a staggering dividend yield exceeding 22%, a figure that typically signals robust returns. However, this attractive income proposition stands in stark contrast to the security’s severe price depreciation, creating a fundamental disconnect that warrants careful examination.

Recent quarterly results for the second quarter of 2025 reveal underlying weaknesses. The net asset value per share was reported at just $2.06, a value substantially higher than the current trading price of approximately €1.58. More alarmingly, the company’s core earnings power appears insufficient to support its distribution policy. With net investment income of only $0.08 per share, Oxford Square Capital fails to cover its monthly dividend payment of $0.035 per share, creating a concerning... Read more...