XAI Octagon Trust Announces Stable Monthly Share Distribution
XAI Octagon Floating Rate & Alternative Income Trust Monthly Update
XAI Octagon Floating Rate & Alternative Income Trust (the “Trust”) recently declared a regular monthly distribution of $0.070 per share on its common shares (NYSE: XFLT). This payment will be disbursed to shareholders on October 1. The amount of the distribution remains unchanged from the previous month, affirming the Trust's commitment to consistent shareholder returns.
Key Dates for Shareholders
For investors interested in the logistics surrounding this distribution, here are the key dates to note:
Ex-Dividend Date
September 16, 2025
Record Date
September 16, 2025
Payable Date
October 1, 2025
Distribution Amount
$0.070 per common share
Previous Month Change
No change
Understanding the Source of Distributions
The Trust utilizes net investment income, capital gains, or returns of capital for its distributions to common shareholders. After the conclusion of the fiscal year, detailed tax characteristics of these distributions will be compiled and provided to shareholders via Form 1099.
It’s important for shareholders to recognize that a portion of their distributions may not stem entirely from net income. This aspect emphasizes the importance of understanding individual investment strategies as distributions can include returns of capital. Thus, any distribution for the period may exceed net investment income, with potential implications for tax basis adjustment.
Long-Term Sustainability of Distributions
The Trust aims to maintain a stable distribution approach over time, taking into account the income fluctuations from its investments. As a registered investment company, it must adhere to a 4% excise tax regulation unless it distributes at least 98% of both its ordinary income and any capital gains to its shareholders by year-end. The Board of Trustees assesses various factors including compliance and performance metrics when determining these distributions.
Investors should remain aware that future distributions are not guaranteed and will depend on multiple factors, including the Trust's financial health, investment income, and cash availability.
Investment Objectives of the Trust
The primary goal of the Trust is to achieve a strong total return, particularly focused on income generation throughout the varying stages of the credit cycle. With a strategy grounded in a diverse range of investment opportunities, the Trust usually invests 80% of its managed assets in floating rate credit instruments and structured credit investments.
Investors in the Trust’s common shares can trade them on the New York Stock Exchange using the symbol “XFLT,” while its preferred shares can be found under the symbol “XFLTPRA.”
About XA Investments
XA Investments LLC (“XAI”), founded by XMS Capital Partners in 2016, serves as the investment adviser for the Trust. The firm, based in Chicago, is involved with two listed closed-end funds and an interval closed-end fund. XAI specializes in investment advisory services, consulting focused on registered closed-end funds and aims to create accessible alternative investment strategies for individual investors.
About XMS Capital Partners
XMS Capital Partners is a proficient global independent financial services firm, established in 2006, providing M&A, corporate advisory, and asset management services to a diverse clientele.
About Octagon Credit Investors
Octagon Credit Investors, the Trust’s investment sub-adviser, boasts over 25 years of experience in below-investment grade corporate credit investments, emphasizing their fundamentals through rigorous credit analysis and active management to identify lucrative opportunities for their investors.
Frequently Asked Questions
What is the distribution amount declared by the Trust?
The Trust declared a monthly distribution of $0.070 per share.
When will the distribution be payable?
The distribution will be payable on October 1.
How can shareholders benefit from the Trust's investment strategy?
Shareholders benefit by potentially receiving stable income through calculated investment strategies focusing on the credit markets.
Is the distribution subject to taxation?
Yes, depending on individual circumstances, distributions may be subject to federal and state taxes.
What is the investment focus of the Trust?
The Trust seeks attractive total returns with an emphasis on income generation primarily through investments in floating rate credit instruments.
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