Two of the market's most popular income ETFs compared side-by-side. See which one fits your yield strategy.
What this means: Both GAIN and TCPC fall intoTier 3: Specialty. This suggests they share a similar risk profile and volatility expectation.
| Metric | GAIN | TCPC |
|---|---|---|
| Total Return (1Y) | 7.73% | -11.14% |
| NAV Change (1Y) | 0.79% | -30.45% |
| Max Drawdown | -22.87% | -46.03% |
| Beta | - | - |
* Returns include dividend reinvestment. Drawdown calculates peak-to-trough decline over trailing 12 months.
GAIN (Gladstone Investment) is a sector-specific income fund managed by BDC. It focuses on generating income through strategic holdings. With significant capital, this fund has been operational since its inception.
Strategy: Concentrates on sector-specific opportunities, typically REITs, MLPs, or BDCs with higher baseline yields.
TCPC (BlackRock TCP Capital) is a sector-specific income fund managed by BDC. It focuses on generating income through strategic holdings. With significant capital, this fund has been operational since its inception.
Strategy: Concentrates on sector-specific opportunities, typically REITs, MLPs, or BDCs with higher baseline yields.
In the head-to-head battle of GAIN vs TCPC, the choice depends on your specific goal. TCPC wins for Immediate Income with a 19.31% yield. However, GAIN is the better choice for Long-Term Growth due to superior total return performance.
Which fund is safer for retirement income? We analyze the yield sustainability and structural risk.
What is a Yield Trap? A yield trap occurs when a fund advertises an attractive headline yield (19.31% in TCPC's case), but that income is partially funded by Return of Capital (ROC) distributions rather than genuine earnings or realized gains. This means you're essentially receiving your own money back, while the fund's NAV erodes.
12-MONTH PERFORMANCE BREAKDOWN:
Why This Matters: For retirees withdrawing income, this creates a double-whammy effect:
⚖️ Verdict: TCPC exhibits classic yield trap characteristics. Income investors should allocate cautiously and consider pairing with capital-preserving assets (Tier 1-2 funds).
The Bottom Line Question: If you invest $100,000 today, how much cash will you actually receive each month? Here's the exact math:
GAIN
Annual Yield: 6.94%
$578/mo
($6,941/year)
Frequency: monthly
TCPC
Annual Yield: 19.31%
$1,609/mo
($19,305/year)
Frequency: quarterly
Income Gap: TCPC generates $12,364/year more than GAIN on the same $100k investment.
Over 20 years, that's $247,272 in additional cash flow (before reinvestment).
Context Matters: Higher income doesn't always mean better investment. Review the "Yield Trap" and "Total Return" sections above—you want income that's sustainable, not just headline-grabbing.
Historical data reveals how these funds behave during market stress. GAIN has delivered a superior Total Return of 7.73% over the past year.
What is Max Drawdown? Max drawdown measures the largest peak-to-trough decline in portfolio value during a specific period. Unlike NAV change (which only looks at start vs. end), max drawdown captures the worst moment of pain an investor experienced.
Real-World Scenario: $100,000 Investment
GAIN (More Resilient)
Max Drawdown: -22.87%
-$22,870
Worst unrealized loss
TCPC (More Volatile)
Max Drawdown: -46.03%
-$46,030
Worst unrealized loss
Protection Value: GAIN saved investors $23,160 in drawdown severity on a $100k position.
Why This Matters More Than Total Return: During bear markets or corrections, investors with lower max drawdown are:
⚖️ Capital Preservation Winner: GAIN demonstrated superior downside protection, making it the better choice for retirees who cannot afford steep temporary losses.
Every investor has a unique risk profile. Use our Portfolio Intelligence tool to see the impact of adding these ETFs to your holdings.