Highland Opportunities and Income Fund Announces Monthly Distribution for December 2025

Highland Opportunities and Income Fund's December Distribution

The Highland Opportunities and Income Fund (NYSE: HFRO), a renowned closed-end investment fund, has made a noteworthy announcement regarding its monthly distribution. As of December 1, 2025, the Fund will distribute
$0.0385 per common share, marking a consistent commitment to returning value to its shareholders. This distribution is set for payment on December 31, 2025, to all shareholders recorded by December 24, 2025.

Understanding the Fund

HFRO operates under an investment strategy aimed at generating both capital growth and income. Specifically, the Fund invests in a variety of securities and financial instruments. These include securities linked to real estate such as Real Estate Investment Trusts (REITs), preferred equity, and mezzanine debt. Additionally, the Fund diversifies its portfolio with fixed-rate loans, corporate bonds, distressed securities, and floating rate loans among others.

As a closed-end fund, HFRO is distinguished by its structure that allows it to operate independently from constant inflow and outflow of investor capital, unlike open-end mutual funds. This structure is intentionally designed for long-term investors seeking a steady income through monthly distributions.

Recent Changes in Strategy

In mid-2023, the Fund underwent a significant transformation, rebranding itself to Highland Opportunities and Income Fund to better highlight its revised investment objectives. This change was officially announced in a press release on May 16, 2023, emphasizing a dual focus—capital appreciation alongside consistent income.

Risk Considerations

While investing in HFRO could yield appealing returns, it's important for potential investors to be aware of the inherent risks involved. The Fund invests substantially in high-yield securities or instruments rated below investment grade, which come with greater risks related to the issuing companies' ability to repay interests and principals. Non-payment scenarios could diminish the Fund's income and net asset value (NAV).

Additionally, real estate investments can pose unique risks including fluctuations in property values, local economic conditions, and regulatory changes—all factors that could potentially affect the Fund's performance. Understanding these variables is crucial for investors who aim to navigate the complexity of closed-end investment companies.

Why Invest in HFRO?

Despite the risks, Highland Opportunities and Income Fund offers a unique investment opportunity for those looking to diversify their portfolios. The ability of the Fund to generate regular income through monthly distributions is especially attractive to income-focused investors. Furthermore, the Fund benefits from the expertise of NexPoint Asset Management, L.P., a registered investment advisor that oversees a diverse array of registered funds.

Investors contemplating participation in the Fund should carefully review the investment objectives, risks, charges, and expenses associated with the HFRO, as outlined in its prospectus. This document can be obtained through direct inquiry or by visiting the Fund's official website.

Conclusion

With the announced monthly distribution for December 2025, HFRO continues to affirm its position in the market as a strong performer in generating income for its shareholders. As the Fund navigates an evolving financial landscape, it remains committed to executing its revised investment strategy that prioritizes both growth and regular income for its investors. Regular monitoring of performance, market conditions, and financial health are paramount for interested investors, bolstering the confidence needed for sound investment in closed-end funds like HFRO.