Company: OXLCZ
Filing Date: 2025-11-05
Form Type: N-CSRS
Source: 0001213900-25-106331
Chunk: 115

Company: Oxford Lane Capital Corp.
Filing Date: 2025-11-05
Form: N-CSRS
Chunk 115
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 their prices more volatile than securities of comparable domestic companies. The economies of individual non -U.S. countries may also differ favorably or unfavorably from the U.S. economy in such respects as growth of gross domestic product, rate of inflation, volatility of currency exchange rates, depreciation, capital reinvestment, resources self -sufficiencyand balance of payments position. Although we expect that most of our investments will be U.S. dollar -denominatedand that most of the CLOs in which we invest will hold CLO Assets which are primarily U.S. dollar -denominated, any investments denominated in a foreign currency will be subject to the risk that the value of a particular currency will change in relation to one or more other currencies. Among the factors that may affect currency values are trade balances, the level of short -terminterest rates, differences in relative values of similar assets in different currencies, long -termopportunities for investment and capital appreciation, and political developments. We may employ hedging techniques to minimize these risks, but we can offer no assurance that it will, in fact, hedge currency risk, or that if we do, such strategies will be effective. Inflation may adversely affect our and our CLO Assets. Inflation risk is the risk that the value of certain assets or income from our investments will be worth less in the future as inflation decreases the value of money. The U.S. and other developed economies have begun to experience higher -thannormal inflation rates. It remains uncertain whether substantial inflation in the U.S. and other developed economies will be sustained over an extended period of time or have a significant effect on the U.S. or other economies. Inflation and rapid fluctuations in inflation rates have had in the past, and may in the future have, negative effects on economies and financial markets, particularly in emerging economies. For example, if an obligor of a CLO Asset in which we invest is unable to increase its revenue in times of higher inflation, its profitability may be adversely affected. As inflation rises, an underlying obligor may earn more revenue but may incur higher expenses, as wages and prices of inputs increase during periods of inflation. Thus, heightened inflationary pressures could increase the risk of default by the CLO’s underlying obligors. In addition, during any periods of rising inflation, the real value of investments and distributions to us would decline, and the dividend rates or borrowing costs associated with our use of leverage would likely increase, all of which would tend to further reduce returns to stockholders.