For example, the PowerShares Senior Loan Portfolio has an average 41.5 day to reset period – the average number of days until the floating component of the loans resets. The passively managed ETF is based on the S&P/LSTA U.S. Leveraged Loan 100 Index, which is designed to track the market-weighted performance of the largest institutional leveraged loans. The fund also comes with a 0.65% expense ratio and an attractive 5.20% 30-day SEC yield.

Along with BKLN, investors may look to the passive index-based the Highland/iBoxx Senior Loan ETF (NYSEArca: SNLN). SNLN tracks the Markit iBoxx USD Liquid Leveraged Loan Index, which consists of the largest, most liquid leveraged loans. SNLN has 31.7 days to reset and a 4.46% 30-day SEC yield. It shows a 0.55% expense ratio.

There are also two actively managed options, including the SPDR Blackstone/GSO Senior Loan ETF (NYSEArca: SRLN), which has a 41 days reset period, a more expensive 0.70% expense ratio and a 3.82% 30-day SEC yield, and First Trust Senior Loan ETF (NasdaqGM: FTSL), which has a 45.31 day reset period, a 0.85% expense ratio and a 3.72% 30-day SEC yield.

Potential investors should also be aware that the senior loan ETFs largely track speculative-grade debt ratings. While senior loans are rated below-investment grade, default rates on senior loans have historically been slightly below those of high-yield or junk bonds. Additionally, in the event of a default, investors are more likely to recoup losses, which may make the asset category less risky than high-yield, speculative-grade debt.

PowerShares Senior Loan Portfolio (NYSEArca: BKLN)