For example, the PowerShares Senior Loan Portfolio (NYSEArca: BKLN) attracted $350 million in net inflows over the past month as investors turned to alternative bond assets in anticipation of a June interest rate hike. In contrast, the iShares iBoxx $ High Yield Corporate Bond ETF (NYSEArca: HYG) saw over $1 billion in net outflows.

BKLN has an average 33.93 day reset period – the average number of days until the floating component of the loans reset. The ETF also comes with an attractive 5.92% 30-day SEC yield.

Along with BKLN, investors may look to the passive index-based Highland/iBoxx Senior Loan ETF (NYSEArca: SNLN). There are also two actively managed options, including the SPDR Blackstone/GSO Senior Loan ETF (NYSEArca: SRLN) and First Trust Senior Loan ETF (NasdaqGM: FTSL).

SNLN has a 40.1 day reset period and a 4.74% 30-day SEC yield. SRLN shows a 36 day reset period and a 3.87% 30-day SEC yield. FTSL comes with a 51.56 day reset period and a 4.06% 30-day SEC yield.

The actively managed bank loan ETF options could provide investors with better exposure as a manager is more freely able to weave in and out of the fixed-income market. For instance, Blackstone/GSO, which subadvises SRLN, is backed by one of the largest senior loan asset managers in the world.

Investors should keep in mind that they are still exposed to credit risk as the majority of underlying bank loan holdings are rated speculative-grade or junk. Additionally, senior loans come with significant liquidity risks – senior loans do not come with a maximum settlement period, which may cause trouble for funds that try to redeem senior loans during more volatile periods. Fund providers, though, may stick to more liquid segments of the senior loan market and hold cash to help offset this risk.

For more information on floating rates, visit our floating rate notes category.