Two ETF Strategies To Profit From Higher Interest Rates

, I would suggest looking at shorter timeframe notes as well as alternative products.

As an example, featured below is the chart for the PowerShares Senior Loan Portfolio (NYSEARCA:BKLN). Senior loans are interesting in that companies borrow under this structure through a floating rate, which adjusts over time. As interest rates move up, the rate paid by the company through the senior loan also moves up.

BKLN powershares senio loan portfolio chart

Chart courtesy of

As you can see, while senior loans do not move exactly in sync with interest rates from long-term bonds, when they are part of an investment strategy in a well diversified portfolio, senior loans can help spread out one’s risks.

These are just a couple of ideas one can incorporate when coming up with an investment strategy for an environment in which interest rates are more than likely set to rise over the next few years.

This article is brought to you courtesy of Sasha Cekerevac from Investment Contrarians.

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