NexPoint Capital, Inc. is a publicly registered non-traded business development company, or BDC, sponsored and advised by NexPoint Advisors L.P. Investors who purchased shares at or near the original offering price have seen significant paper losses as the company’s net asset value has declined. Haselkorn & Thibaut, P.A., operating as Investment Fraud Lawyers, is investigating whether brokerage firms and financial advisors properly disclosed the risks of this illiquid alternative investment before recommending it to retail clients.
If you invested in NexPoint Capital BDC and suffered losses, you may have legal options. Non-traded BDCs carry limited liquidity, complex valuations, and high fees. Our firm represents investors nationwide in FINRA arbitration and securities litigation. Call 1-888-885-7162 for a free consultation. We work on contingency. No recovery, no fee.
What is NexPoint Capital, Inc. BDC?
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NexPoint Capital, Inc. is a non-traded business development company that invests primarily in private debt and alternative investments. The BDC focuses heavily on healthcare-related sectors, including senior housing, long-term care properties, and medical facilities. The strategy targets demographic trends tied to an aging population.
Unlike publicly traded BDCs, NexPoint Capital shares do not trade on a national exchange. Investors generally cannot sell shares on the open market. The company offers a dividend reinvestment plan, or DRIP, that allows shareholders to reinvest distributions into additional shares priced at or near the company’s net asset value.
The company’s primary public offering terminated on February 14, 2018. After that date, the company deregistered its remaining unsold shares. Existing shareholders have been left with limited liquidity options, including periodic tender offers and the DRIP.
NAV decline and investor losses
NexPoint Capital’s net asset value per share has declined substantially since 2020. Many investors purchased shares at approximately $10.00 per share. Recent disclosures show NAV falling to roughly $4.30 per share as of March 31, 2026. This represents a long-term decline of approximately 57% from the original offering price.
| Date | NAV per share | Change from prior period | Source |
|---|---|---|---|
| 2020 | $6.13 | Baseline | Company disclosures / industry reports |
| 2023 | $5.36 | -12.6% from 2020 | Company disclosures / industry reports |
| Year-end 2025 | $4.60 | -24.6% from 2020 | AltsWire / SEC filings |
| Jan 2026 | $4.43 | -27.7% from 2020 | AltsWire |
| Feb 28, 2026 | $4.40 | -28.2% from 2020 | AltsWire |
| Mar 23, 2026 | $4.35 | -29.0% from 2020 | AltsWire |
| Mar 31, 2026 | $4.30 | -29.9% from 2020; -57% from $10 offering price | AltsWire / company reports |
The decline accelerated in early 2026. Between year-end 2025 and March 31, 2026, NAV fell from $4.60 to $4.30, a drop of approximately 6.5% in just three months. Investors who reinvested distributions through the DRIP during this period bought shares at declining valuations, which can compound losses over time.
Distribution concerns and liquidity limits
NexPoint Capital resumed paying distributions after prior suspensions. In April 2026, the company declared a $0.09 per share cash distribution for shareholders of record as of March 31, 2026. However, the distribution came while NAV continued to fall. In some cases, distributions from non-traded BDCs may include a return of investor capital rather than true investment income.
Liquidity remains severely limited. In February 2026, the company launched a tender offer to repurchase up to 1% of its outstanding common stock at approximately $4.43 per share. In November 2025, a separate tender offer covered up to 1.5% of outstanding shares at $4.75 per share. These programs are not meaningful exit ramps for most shareholders.
| Tender offer date | Maximum repurchase | Price per share | Limitations |
|---|---|---|---|
| Nov 2025 | Up to 1.5% of outstanding shares | $4.75 | Pro-rata if oversubscribed; small exit window |
| Feb 2026 | Up to 1% of outstanding shares | Approx. $4.43 | Extremely limited; most investors remain locked in |
Under the DRIP, shares are issued at a price not less than NAV and not more than 2.5% above NAV, at the adviser’s discretion. For the March 31, 2026 period, the DRIP issuance price was set at $4.30 per share. This means investors reinvesting distributions are buying shares at a lower and declining valuation.
Risks of non-traded BDC investments
Non-traded BDCs like NexPoint Capital involve risks that differ materially from traditional stocks and bonds. These products are often marketed as income-generating alternatives, but the structure can trap retail investors in declining positions with no easy exit.
Limited liquidity: Shares do not trade on an exchange. Investors must rely on company-sponsored repurchase programs, which are typically limited, discretionary, and subject to pro-rata reductions.
Lack of price transparency: NAV is determined by the adviser in accordance with Rule 2a-5 under the Investment Company Act of 1940. The valuation process involves judgment and may not reflect a true market exit price.
Healthcare sector concentration: NexPoint Capital focuses on healthcare-related assets, including senior housing and medical facilities. This concentration exposes investors to sector-specific risks such as regulatory changes, reimbursement pressure, and sensitivity to healthcare market conditions.
High fees and commissions: Non-traded BDCs often charge high upfront commissions, ongoing management fees, and incentive fees. These costs reduce investor returns and can make recovery more difficult when NAV declines.
Return of capital risk: Distributions may include a return of investor capital rather than income. When distributions are paid while NAV is falling, investors may be receiving their own money back while the underlying investment loses value.
Broker-dealer and advisor responsibility
Brokers and financial advisors who recommended NexPoint Capital BDC had obligations under FINRA Rule 2111 and SEC Regulation Best Interest, or Reg BI. These rules require recommendations to be suitable and in the retail investor’s best interest.
Specific duties include explaining the illiquid nature of non-traded BDCs, disclosing that NAV may decline, reviewing the investor’s risk tolerance and liquidity needs, and ensuring the investment was not overconcentrated in the client’s portfolio. Advisors must also compare alternative investments and ensure the recommended product is appropriate for the customer.
Potential sales practice violations include unsuitable recommendations for conservative or income-oriented investors, failure to disclose that shares purchased at substantially higher prices had materially declined in value, misrepresentations regarding income stability or liquidity, overconcentration in illiquid alternatives, and inadequate due diligence concerning the product’s structure and risks.
What investors who lost money in NexPoint Capital can do
If you invested in NexPoint Capital BDC and experienced losses, take these steps to protect your rights.
First, gather your subscription documents, account statements, and correspondence with your advisor. Look for the original purchase price, any DRIP reinvestments, and current account value. Documents showing what you were told at the time of sale are particularly important.
Second, review whether your advisor disclosed the risks of non-traded BDCs, the decline in NAV, and the limited liquidity options. If the investment was presented as safe, stable, or liquid, that may be a red flag.
Third, contact a qualified securities attorney promptly. FINRA arbitration has a six-year eligibility period under Rule 12400. Early review preserves evidence and protects your ability to pursue recovery.
How Investment Fraud Lawyers can help
Our attorneys include former Wall Street defense counsel who spent decades representing the largest financial institutions. We now use that insider knowledge to fight for individual investors. We understand how brokerage firms defend these cases and where they are vulnerable.
Our firm has a 98% success rate, over 95 years of combined experience, and involvement in more than $520 million of securities cases. We are rated AV Preeminent by Martindale-Hubbell, placing us in the top 2% of attorneys. We work on contingency. No recovery, no fee.
Call 1-888-885-7162 for a free consultation. We represent investors nationwide in FINRA arbitration and securities litigation.
Frequently asked questions
What is NexPoint Capital, Inc. BDC?
NexPoint Capital, Inc. is a publicly registered non-traded business development company sponsored and advised by NexPoint Advisors L.P. It invests primarily in private debt and alternative investments with a concentration in healthcare-related sectors such as senior housing and medical facilities.
Why has NexPoint Capital BDC lost value?
The BDC’s net asset value per share has declined from approximately $6.13 in 2020 to $4.30 as of March 31, 2026. The decline reflects portfolio pressure, healthcare sector risks, and broader market conditions. Because many shares were sold at approximately $10.00, investors may have paper losses exceeding 50%.
Can I sell my NexPoint Capital BDC shares?
Liquidity is very limited. The shares do not trade on a public exchange. The company has offered limited tender offers for up to 1% to 1.5% of outstanding shares. Most investors remain locked into the investment with no ready exit.
What is the DRIP and how does it affect investors?
The dividend reinvestment plan allows investors to reinvest distributions into additional shares. DRIP shares are issued at a price not less than NAV and not more than 2.5% above NAV. With NAV declining, investors who reinvest are buying shares at lower and falling valuations, which can compound losses.
Are the distributions from NexPoint Capital BDC safe income?
Distributions are not guaranteed and may be suspended, modified, or terminated by the board. When distributions continue while NAV is declining, some or all of the distribution may represent a return of investor capital rather than investment income. This reduces principal value over time.
Can I recover my NexPoint Capital BDC losses through FINRA arbitration?
Possibly. Investors may have claims if the BDC was unsuitable, risks were not properly disclosed, the advisor misrepresented income or liquidity, or the investment was overconcentrated. FINRA arbitration has a six-year eligibility period. A qualified securities attorney can review your specific situation.
Disclaimer: Past results do not guarantee future outcomes. This page provides general information and is not legal advice. No attorney-client relationship is formed by reading this content.
There is no guaranteed recovery in any securities matter. Consult a qualified attorney regarding your specific situation.
