Goldman Sachs Asset Management has launched the Goldman Sachs High Yield Floating Rate Fund. It invests in below investment-grade, floating-rate loans and other variable-rate securities issued by U.S. and foreign companies. The fund’s investment objective is to generate a high level of current income.
“We believe floating-rate loans are appealing to investors because they combine relatively moderate price volatility with attractive income that rises along with interest rates,” said Rachel Golder, co-head of the high yield and bank loan team and head of corporate credit research for GSAM.
“The Goldman Sachs High Yield Floating Rate Fund seeks to help investors navigate a changing interest rate environment by seeking to uncover what our team believes are the most attractive income opportunities relative to their risk within the non-investment grade loan market,” Golder said.
Michael Goldstein, co-head of the high yield and bank loan team, will be lead portfolio manager of the fund. “The fund is potentially a portfolio land fixed income diversifier, as floating-rate loans have historically posted lower correlations to other asset classes,” Goldstein said. “Additionally, they rank as more senior in an issuer’s capital structure and tend to he higher in quality, implying lower default risk and higher recovery rates.”
Goldstein will manage the fund along with GSAM’s global corporate credit team.