HFRO - Highland Opportunities & Income Fund

What this means for you

Saba and James D Dondero have told the regulator it may push for changes at this fund. That usually means asking the fund to buy back shares at close to the full value of its holdings, to change who runs it, or to close down and pay holders out.

Nothing is required of you now. If the fund itself announces a buy-back or a vote, it appears in the box above with the date by which you would need to act.

Large investors can also sell down and walk away. We show every notice they file, the day it is filed.

Email me if this changes

What happened, and when

1. July 29, 2026

   James D Dondero raised its stake to 9.6% (from 8.5%). It has said it may push for changes.

   Original document →

2. June 4, 2026

   Saba raised its stake to 10.5% (from 9.4%). It has said it may push for changes.

   Original document →

3. April 14, 2026

   Saba raised its stake to 9.4% (from 8.3%). It has said it may push for changes.

   Original document →

4. April 1, 2026

   James D Dondero raised its stake to 8.5% (from 7.5%). It has said it may push for changes.

   Original document →

5. Feb 11, 2026

   Morgan Stanley cut its stake to 5.1% (from 6.3%), as a passive investor.

   Original document →

About this fund

• Run by NexPoint Asset Management, L.P. Part of the NexPoint Asset Management, L.P fund family. As of Dec 31, 2025, from the fund's yearly report. Original document →
• Size: about $652 million of holdings, as of June 30, 2026. As of June 30, 2026, from the fund's quarterly holdings report. Original document →
• Borrowing: the fund borrows about 28% on top of its own money, as of June 30, 2026. Borrowed money makes gains and losses bigger. As of June 30, 2026, from the fund's quarterly holdings report. Original document →
• Costs: 0.9% a year in management fees; 2.4% a year in total, including interest on borrowed money. Fiscal year ended Dec 31, 2025. As of Dec 31, 2025, from the fund's yearly report. Original document →
  Among the 90 funds we follow that invest in bonds, 26 charge a lower management fee and 26 charge less in total, at their last yearly reports. Both numbers are measured against the fund's own money, not the money it borrows on top, so a fund that borrows more shows higher costs on both counts.
• Payouts: last fiscal year (ended Dec 31, 2025) the fund paid $0.46 a share. $0.08 of that was income; $0.38 was your own money back, not income. Most funds announce their monthly or quarterly payout on their own website, not in a filing with the regulator, so a cut or a raise there does not show up here until the next yearly report. A few funds do file a notice about a fixed payout; those appear under What happened, and when. As of Dec 31, 2025, from the fund's annual report. Original document →
• Value of holdings per share at the last fiscal year end (Dec 31, 2025): $11.39. The shares traded at $5.98, about 47.5% below that. As of Dec 31, 2025, from the fund's yearly report. Original document →
• How the holdings did: up 5.5% over the last three months we have (April-June 2026), before the share price is taken into account. As of June 30, 2026, from the fund's quarterly holdings report. Original document →
• First reported to the regulator in 2017.

How this has changed

• Payouts per share: $0.46 in the fiscal year ended Dec 31, 2025; $0.46 in the year ended Dec 31, 2024; $0.92 in the year ended Dec 31, 2023.As of Dec 31, 2025, from the fund's annual report. Original document →
• Of that, your own money back rather than income: $0.38 in the year ended Dec 31, 2025; $0.05 in the year ended Dec 31, 2024; $0.31 in the year ended Dec 31, 2023.As of Dec 31, 2025, from the fund's annual report. Original document →
• Costs, including interest on borrowed money: 1.63% a year in the fiscal year ended Dec 31, 2025; 1.24% a year in the year ended Dec 31, 2024; 1.25% a year in the year ended Dec 31, 2023.As of Dec 31, 2025, from the fund's annual report. Original document →
• Size of the holdings: about $630 million at Dec 31, 2025; $841 million at Dec 31, 2024; $861 million at Dec 31, 2023. From the fund's quarterly holdings reports. Original documents: Dec 31, 2025 →, Dec 31, 2024 →, Dec 31, 2023 →.
• Borrowing: about 28% on top of its own money at Dec 31, 2025; 15% at Dec 31, 2024; 17% at Dec 31, 2023. From the fund's quarterly holdings reports. Original documents: Dec 31, 2025 →, Dec 31, 2024 →, Dec 31, 2023 →.
• The fund had about 55.4 million shares at Dec 31, 2025, down 19% from Dec 31, 2023.As of Dec 31, 2025, from the fund's annual report. Original document →

What these lines mean: a payout that is your own money back, what a fund costs, borrowing.

What a holder made

• The year ended Dec 31, 2025: the shares returned +25.1%, counting payouts. As of Dec 31, 2025, from the fund's annual report. Original document →
• The year ended Dec 31, 2024: the shares returned -27%, counting payouts. As of Dec 31, 2024, from the fund's annual report. Original document →
• The year ended Dec 31, 2023: the shares returned -16.9%, counting payouts. As of Dec 31, 2023, from the fund's annual report. Original document →
• The year ended Dec 31, 2022: the shares returned +1.7%, counting payouts. As of Dec 31, 2022, from the fund's annual report. Original document →
• The year ended Dec 31, 2021: the shares returned +16.4%, counting payouts. As of Dec 31, 2021, from the fund's annual report. Original document →
• Those five years together: the shares returned -10.3%. $10,000 of shares bought at the start (Jan 1, 2021) would have become about $8,970 by Dec 31, 2025, with every payout counted, before tax. As of Dec 31, 2025, from the fund's annual report. Original document →
• The holdings over the last twelve months we have, to June 30, 2026: +3.8%. The quarterly reports carry no share price, so this is the holdings alone. As of June 30, 2026, from the fund's quarterly holdings report. Original document →
• Of the 75 funds that invest in bonds with a fiscal year ending within six months of this one, 2 reported a higher share return for that year and 72 a lower one. As of Dec 31, 2025, from the fund's annual report. Original document →
• A past year says nothing about the next one. All figures are the fund's own, from its reports to the regulator.

Why the shares and the holdings can differ: the gap between price and value. Why payouts count: a payout that is your own money back.

What the fund holds

Mostly shares (67%), the rest bonds, cash and short-term holdings and loans. About 99% issued in the U.S.

1. Nfro REIT Sub LLC Nfro REIT Sub - 17.3%
2. Nfro Holdings, LLC - 11%
3. Nfro REIT Sub LLC Nfro REIT Sub II - 10.6%
4. Nfro Sfr REIT Sub - 9.8%
5. Nexls LLC - 7.8%
6. NexPoint Real Estate Finance, Inc. - 6.8%
7. Sfr Operating Partnership, L.P. Convertible Note - 6.7%
8. Cash and short-term - 6.6%
9. Nxdt Hospitality Convertible Promissory Note - 5.1%
10. NexPoint Credit Catalyst-Z Mutual Fund - 3.9%

As of June 30, 2026, from the fund's quarterly holdings report. Original document →