PowerShares Senior Loan ETF (BKLN)
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Bank-loan funds that aim to pay investors more when interest rates increase are having their best fundraising streak in more than two years as buyers chase performance and the fulsome prices the investments now command. The products, which are sold as mutual funds and exchange-traded funds, purchase floating-rate loans which will pay out more in interest if the key benchmark London interbank offered rate (Libor) crosses above the 1 percent mark. Investors are eying the December U.S. Federal Reserve monetary policy decision with increased anticipation as the central bank is widely expected to raise rates.
- ETF.com•8 days ago
This has been a good year for high-yield bond ETFs, and in the near term, the outlook for defaults is also positive. But there's the issue of valuations—they are looking high and could be pointing to a top.