First Trust Advisors has launched the First Trust Short Duration High Income Fund

The fund utilizes a short-duration strategy to bet on senior loans and high-yield bonds.

"Investors have been on an income hunt, but there are not many income-producing ideas out there for investors that help to navigate the interest rate risk that's out there," senior vice president and senior portfolio manager William Housey told Money Manageent Executive. "With this fund, we have a unique approach given a unique opportunity."

Housey explained that the fund gives First Trust the ability to be "tactical" between both senior loans and high-yield bond funds, which companies tend to include both of in their capital structure. Housey also sees opportunity in the fact that senior loans are currently yielding more than high-yield bond funds, according to the JPMorgan Global High Yield Index.

"We view this as an aberration. This is the type of event that creates an opportunity for us, and with this fund — which is more tactical in that we can pick the best part of a given capital structure — we can navigate that environment."

Housey, senior vice president Scott Fries, and vice president Peter Fasone serve as portfolio managers of the fund.

First Trust is based in Wheaton, Ill., and manages collective assets of $63 billion as of Dec. 31, 2012, through mutual funds, exchange-traded funds, unit investment trusts, separate managed accounts and closed-end funds.

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