State Street Global Advisors has joined forces with GSO Capital Partners, the global credit business of The Blackstone Group, to launch the SPDR Blackstone/GSO Senior Loan ETF (SRLN).
The ETF, which began trading on NYSE Arca on April 4, is touted by SSgA as the first actively managed ETF to provide exposure to senior loans. The ETF’s expense ratio is 90 basis points.
The ETF is designed to seek high current income, preserve capital and outperform the Markit iBoxx USD Liquid Leveraged Loan Index and the S&P/LSTA U.S. Leveraged Loan 100 Index.
Usually rated below investment grade, it is typical in the loan market to expect that 30 to 35% of loans will fall out of the index in any given year. So the ability to anticipate and react quickly to changes in the market through an active strategy is potentially advantageous, according to SSgA.