Bank Loan ETFs: More Competition in Red-Hot Sector

The First Trust actively managed ETF will also be going up against two passive senior bank loan ETFs: PowerShares Senior Loan Portfolio (NYSEArca: BKLN), which tracks the S&P/LSTA U.S. Leveraged Loan 100 Index; and the Highland/iBoxx Senior Loan ETF (NYSEArca: SNLN), which tracks the Markit iBoxx Liquid Leveraged Loan Index.

The PowerShares BKLN has a 0.66% expense ratio and a 3.90% 30-day SEC yield. BKLN is the largest ETF in this category and has witnessed assets more than double since the start of the year, gaining over $2 billion in new inflows. The Highland SNLN has a 0.55% expense ratio and a 5.15% 30-day SEC yield.

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Max Chen contributed to this article.

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