MidCap Financial Investment

1. Interest Rate Risk: As Apollo Investment Corporation’s investments are largely debt-based, any change in interest rates affects their profitability. Rising interest rates raise borrowing costs, resulting in lower gains on interest income.

2. Credit Risk: Credit risk is the risk of a borrower defaulting on payments. Apollo Investment Corporation’s portfolio is exposed to a wide range of credit risks. If a borrower fails to meet interest payments or defaults on the principal, Apollo Investment Corporation would be left with an impaired security.

3. Liquidity Risk: Liquidity risk is the risk of a portfolio being unable to offload assets quickly and at close to market value. As many of Apollo Investment Corporation’s investments are illiquid, this risk is heightened.

4. Regulatory Risk: Regulatory risk is the risk of changes in laws or regulations impacting the value of their portfolio. Apollo Investment Corporation is exposed to this risk as they invest in a variety of sectors, which may be subject to different regulations.

5. Market Risk: Market risk is the risk of fluctuations in the stock market impacting Apollo Investment Corporation’s investments. As many of their investments are publicly traded, they are necessarily exposed to market risk.