Senior Loan (Bank Loan) ETFs

There are four major senior loan ETFs with assets totaling over $13billion. Two are passive and two are actively managed.

The Rieger Report ranks them as follows:

  • SPDR Blackstone GSO Senior Loan ETF (SRLN) (Active) – Rationale: incrementally higher yield, relative ETF liquidity and lower tracking error
  • Invesco Senior Loan Portfolio (BKLN) – Rationale: relative ETF liquidity, passively tracks the larger loans which typically have deeper secondary market trading. An important plus: options are available for hedging purposes
  • First Trust Senior Loan (FTSL) – Rationale: Similar results to BKLN however with higher fees. Not as liquid as BKLN as measured by total $ value traded
  • Highland iBoxx Senior Loan (SNLN): Rationale: comparative lower ETF liquidity even though this ETF has been in existence since November 2012.

Author’s note: Evidence for or against active or passive investing in over the counter and less liquid asset classes can be highlighted here. Time will tell!

Senior Loan (Bank Loan) ETFs (Over $500million in Assets)

August72018-1

  1. Assets Under Management. Data as of 8/6/2018 or as otherwise stated.
  2. As of 6/30/2018.
  3. Although actively managed, each ETF reports a benchmark and the performance difference is noted here. Tracking error is calculated using the ETF market value performance vs. index stated by fund sponsor.

Data as of 8/6/2018 or as otherwise stated.

Sources: ishares by Blackrock, https://www.ishares.com/us , Highland Funds www.highlandfunds.com , Invesco www.invesco.com and First Trust www.ftportfolios.com   Table is shown for illustrative purposes only. Past performance is not indicative of future results.

Analyst Disclosure

  • JR Rieger and or the Rieger Report LLC has not received compensation either directly or indirectly from the sponsor(s) of the ETF(s) included in this report.
  • At the time of this writing, JR Rieger does not own the ETF(s) cited in this report.
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