Skip to main content

KIO KKR Income Opportunities Fund

About KKR

KKR Credit Advisors (US) LLC (the “Advisor”) serves as the Fund’s investment advisor. Launched in 2004, the Advisor is a subsidiary of KKR & Co. Inc. (together with the Advisor and its other affiliates, “KKR”), a leading global investment firm with more than a 44-year history of leadership, innovation and investment. The Advisor’s investment teams, which are organized by industry, invest across the capital structure with the goal of protecting capital and achieving attractive risk-adjusted returns.

Fund Objective and Strategy

KKR Income Opportunities Fund (“KIO” or “the Fund”) seeks allocate across credit instruments to capitalize on changes in relative value among corporate credit investments and manage against macroeconomic risks. The Fund is designed to offer investors:

Potential for attractive levels of current income through monthly distributions

A targeted portfolio investing primarily in bank loans and high yield securities

KKR Credit's consistent approach and strong credit investment process that seeks to adapt credit strategies to market conditions

Fund Facts as of September 30, 2020

INCEPTION DATE
7/25/2013
SYMBOL
KIO
NAV SYMBOL
XKIOX
TOTAL MANAGED ASSETS
~$473M
SHARES OUTSTANDING
20,340,315
CLOSING MARKET PRICE AS OF 9/30/20
$13.53
CLOSING NAV AS OF 9/30/20
$14.68
CURRENT MONTHLY DIVIDEND (PER SHARE)
$0.125
PREMIUM (DISCOUNT)
(-7.83%)

KIO Growth of $10K Investment Since Inception (7/25/13)

Portfolio Characteristics as of September 30, 2020

Credit Quality
B (10.2%)
B- (24.8%)
B+ (2.0%)
BB (4.6%)
BB- (2.7%)
BB+ (0.9%)
BBB- (2.7%)
CC (0.2%)
CCC (10.7%)
CCC- (8.9%)
CCC+ (32.0%)
D (0.3%)
Portfolio Consumption
Leveraged Loan (53.8%)
High Yield Security (44.4%)
Common Stock (1.7%)
Preferred Stock (0.1%)
Top 10 Issuers
Sequa Corp. 4.1%
The Kenan Advantage Group, Inc. 3.7%
ClubCorp Club Operations, Inc. 2.9%
Diamond Resorts International, Inc. 2.9%
Cemex Materials LLC 2.9%
CommScope, Inc. 2.9%
Applied Systems, Inc. 2.4%
Excelitas Technologies Corp. 2.3%
Varsity Brands Holdings Co., Inc. 2.1%
Misys Ltd. 2.0%
TOTAL 28.2%
Top 5 Industries
HOTELS, RESTAURANTS & LEISURE 15.3%
SOFTWARE 8.4%
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS 5.7%
COMMERCIAL SERVICES & SUPPLIES 5.5%
AEROSPACE & DEFENSE 5.4%
TOTAL 40.3%
Geography
United States 90.6%
European Union 3.7%
Cayman Islands 1.6%
Other 4.1%

About Risk: An imbalance in supply and demand in the income market may result in valuation uncertainties and greater volatility, less liquidity, widening credit spreads and a lack of price transparency in the market. Investments in income securities may be affected by changes in the creditworthiness of the issuer and are subject to the risk of non–payment of principal and interest. The value of income securities also may decline because of real or perceived concerns about the issuer’s ability to make principal and interest payments. Borrowing to increase investments (leverage) will exaggerate the effect of any increase or decrease in the value of Fund investments. Investments rated below investment grade (typically referred to as “junk”) are generally subject to greater price volatility and illiquidity than higher rated investments. As interest rates rise, the value of certain income investments is likely to decline. Senior loans are subject to prepayment risk. Investments in foreign instruments or currencies can involve greater risk and volatility than U.S. investments because of adverse market, economic, political, regulatory, geopolitical or other conditions. Changes in the value of investments entered for hedging purposes may not match those of the position being hedged. The Fund may engage in other investment practices that may involve additional risks.

Investment Team

Partner, Traded Credit
  • Head of Leveraged Credit

Subscribe

To get in contact with a KKR representative please provide your contact information below

The Fund invests mainly in leveraged loans, high yield securities, common stocks not actively traded and preferred stocks. These investments may involve certain risks, including, but not limited to, those described below:

Market Discount Risk — The price of the Fund’s common shares of beneficial interest will fluctuate with market conditions and other factors. Shares of closed-end management investment companies frequently trade at a discount from their net asset value, which may increase the risk of loss.

Leverage Risk — Leverage is a speculative technique that may expose the Fund to greater risk and increased costs. When leverage is used, the net asset value and market price of the Fund’s shares and the Fund’s investment return will likely be more volatile.

Market Risk — Bond markets rise and fall daily. As with any investment with performance tied to these markets, the value of an investment in the Fund will fluctuate, which means that shareholders could lose money.

Interest Rate Risk — Interest rates will rise and fall over time. During periods when interest rates are low, the Fund’s yield and total return also may be low. Changes in interest rates also may affect the Fund’s share price and a sharp rise in interest rates could cause the Fund’s share price to fall. The longer the Fund’s duration, the more sensitive to interest rate movements its share price is likely to be.

Credit Risk — The Fund is subject to the risk that a decline in the credit quality of an investment could cause the Fund to lose money or underperform. The Fund could lose money if the issuer or guarantor of an investment fails to make timely principal or interest payments or otherwise honor its obligations. The Fund will be subject to credit risk with respect to the counterparties of derivative contracts (whether a clearing corporation in the case of exchange-traded instruments or another third party in the case of over-the-counter instruments) and other instruments entered into directly by the Fund.

Liquidity Risk — A particular investment may be difficult to purchase or sell. The Fund may be unable to sell illiquid securities at an advantageous time or price.

Prepayment and Extension Risk — The Fund’s investments are subject to the risk that the investments may be paid off earlier or later than expected. Either situation could cause the Fund to hold investments paying lower than market rates of interest, which could hurt the Fund’s yield or share price.

High Yield Risk — High yield securities and unrated securities of similar credit quality (sometimes called junk bonds) that the Fund may invest in are subject to greater levels of credit and liquidity risks. High yield securities are considered primarily speculative with respect to the issuer’s continuing ability to make principal and interest payments.

Foreign Investment Risk — The Fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and other conditions; changes in currency exchange rates (the currencies will decline in value relative to the U.S. dollar or, in the case of hedging positions, the U.S. dollar will decline in value relative to the currency being hedged) or exchange control regulations (including limitations on currency movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing securities market structures; and higher transaction costs. These risks may be heightened in connection with investments in emerging markets.

Issuer Risk — The value of securities may decline for a number of reasons that directly relate to the issuer, such as its financial strength, management performance, financial leverage and reduced demand for the issuer’s goods and services, as well as the historical and prospective earnings of the issuer and the value of its assets.