ETFs logged record outflows last month but that didn’t stop investors from pumping nearly $400 million into the largest fund tracking bank loans as interest rates continue to creep higher.
PowerShares Senior Loan Portfolio (NYSEArca: BKLN) is the largest ETF in the category with about $5.3 billion of assets. Investors have been favoring bank loan ETFs as a yield play with protection from rising rates since the funds invest in floating-rate securities. [Bank Loan ETFs Keep Growing]
BKLN is paying a 12-montn yield of 4.66%, according to manager Invesco PowerShares. [Bank Loan ETFs for Yield and Rising Rate Hedge]
Other ETFs for this sector include Highland/iBoxx Senior Loan (NYSEArca: SNLN), SPDR Blackstone/GSO Senior Loan ETF (NYSEArca: SRLN) and First Trust Senior Loan Fund (NasdaqGM: FTSL).