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# Oxford Lane Capital: Why I Think This Is A Yield Trap (Archive)
- URL: https://www.huntingalphas.com/oxford-lane-capital-why-i-think-this-is-a-yield-trap-archive/
- Published: 2024-08-26T08:22:00.000Z
- Updated: 2026-02-27T13:12:37.000Z
- Description: Highlighting unsustainable payouts from negative cash flows and premium-valued, underwater investments.
- Author: Vish (Hunting Alphas)
- Tags: 5-Minute Pitches, #noindex, Archive, #sa-origin, OXLC, CEF

*This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.*

## Elevator Pitch

- Oxford Lane Capital has outperformed the S&P 500 by +1.94% since my last 'Sell' view on this closed-ended fund in February 2024\. But I am retaining my stance.
- Distributions continue to be funded by capital raises instead of operational cash flow. I don't see how this is sustainable long term.
- Oxford Lane Capital investments' fair value is below cost, which means the sale of investments would also lead to a loss. This does not help recoup negative operating cash flows.
- The company's net asset value has been falling to stagnant due to these headwinds. Still, OXLC is trading at an 8.8% premium to NAV, making buys less appealing.
- Relative to the S&P 500, my technicals read shows scope for OXLC to underperform, as the ratio prices are currently rejecting off a key monthly resistance level.

Read the full article [here](https://seekingalpha.com/article/4717024-oxford-lane-capital-why-i-think-this-is-yield-trap?ref=huntingalphas.com).

#### Disclosures and Disclaimers

**Past performance ≠ future results. Not investment advice. See* [**full Disclaimer*](https://www.huntingalphas.com/disclaimer/)**.*