In an effort to meet the growing investor demand for increased yield and protection against the threat of rising interest rates, Invesco Canada has launched the PowerShares Senior Loan (CAD Hedged) Index ETF, Canada’s first senior loan exchange traded fund.
Invesco Canada’s latest offering provides access to an asset class that has historically delivered higher yield than other fixed-income securities of equal or higher credit quality and provided investors with an added measure of security against borrower default. In addition, the low duration of senior loans may help to reduce a portfolio’s overall interest-rate sensitivity.
"With this new ETF, Invesco Canada is helping to open up an asset class that has traditionally been traded exclusively by institutional investors," says Michael Cooke (pictured), Head of Distribution for PowerShares Canada. "Senior Loans are a great way for investors to diversify their fixed-income portfolios by offering low correlation to other fixed-income segments."
This new ETF seeks to replicate (before fees and expenses) the performance of the S&P/LSTA (Loan Syndications and Trading Association) US Leveraged Loan 100 Index (CAD Hedged). The index gives investors exposure to the largest 100 loan facilities drawn from a larger benchmark – the S&P/LSTA Leveraged Loan Index.