Portfolio Company Default Risk: The ability of Fidus to generate income and recover principal is highly dependent on the financial health and performance of its portfolio companies, which are typically unrated, private middle-market businesses subject to higher credit risk.

Interest Rate Fluctuation Risk: A significant portion of FDUS's investments are in floating-rate loans, making their net investment income sensitive to changes in benchmark interest rates, which could also impact their borrowing costs.

Fair Value Valuation Risk: The majority of FDUS's assets are illiquid debt and equity investments in private companies, for which market quotations are not readily available, leading to subjective fair value determinations that may not reflect actual realizable value.