The subject of this thread is specifically focused on Floating Rate/Bank Loan funds, in varying kinds of interest rate environments. The thread was started by Junkster, a very well known trader. Several other posters commented, with a variety of investing styles, some similar to Junkster and some very different from Junkster. Before I retired in 2013, my only exposure to FR/BL was as a component of a multisector, nontraditional, or HY bond oef. After I retired, for varying reasons, I increased my exposure to a variety of bond oef categories, including a focused FR/BL fund (SPFLX). Interest rates were not rising during this period of time, and interest rates had been very low for several years. In short, it was a flat interest rate environment. I decided that the SPFLX fund had established an attractive recent performance history, in a flat rate interest rate environment. I made some very attractive returns for several years under these conditions. Yes FR/BL funds, including SPFLX, got clobbered in 2022, as part of a market crash that took no mercy on junk bond funds such as SPFLX. That market crash is over, and we are now a little over a year out since interest rates have gone through a history increase for over a year. Now the Feds want to hold rates steady for an evaluation of the impact of their rate increases--they want to hold down inflation, and avoid a recession if possible. I think it is very feasible that rates will not change much going forward, and it is more likely we will see small and gradual interest rate increases. Under those conditions, FR/BL could be excellent performers for the forseeable future. But everyone can look at their crystal ball, make their own market forecasts, but I don't see any immediate threat to those holding FR/BL and may still be a very good option to those who want to wade in with a portion of their portfolio. I don't think I will be one of them for now, because MMs and CDs are still attractive for a retiree, choosing to stay with very low risk options.

The CME FedWatch has to adjust a LOT to fit the Fed's narrative of possibly 2 more hikes in 2023, and no cuts for almost 2 years (Powell said so). Powell also said that he/Fed/FOMC don't want to surprise the markets, so expect lot of Fed speakers jawboning the markets into line.
The CME Fed watch this AM shows hike-hold-hold-hold-cut....
https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html

AAII Sentiment Survey, 6/14/23
Bullish remained the top sentiment (45.2%; above average) & bearish remained the bottom sentiment (27.7%; below average); neutral remained the middle sentiment (32.1%; above average); Bull-Bear Spread was +17.5% (above average). Investor concerns: Inflation (moderating but high); economy; the Fed (hawkish-pause yesterday - 2 more hikes by 2023YE?); dollar; crypto regulations; market volatility (VIX, VXN, MOVE); Russia-Ukraine war (68+ weeks, 2/24/22- ); geopolitical. For the Survey week (Th-Wed), stocks were up, bonds up, oil down, gold up, dollar down. Powell said that rates may not be cut for 2 years. #AAII #Sentiment #Markets
https://ybbpersonalfinance.proboards.com/post/1071/thread

Treasury rates didn't move much; 3-6 mo is the sweet spot. Stocks saw some volatility - Powell said don't expect rate cut for almost 2 years! Does that define higher rates for longer?
https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?type=daily_treasury_yield_curve&field_tdr_date_value_month=202306

YBB Notes
Hawkish-hold, so the fed funds remain at 5.00-5.25%, but it could go up by 25-50 bps by 2023YE; the (bank) reserve balance rate is 5.15%; the discount rate is 5.25%. The pause now is to let the effects of Fed actions so far work given some lag. The 2-yr is a good indicator of where the fed funds may be going. The Fed doesn't want to surprise the markets (so, monitor CME FedWatch). Any Fed rate cuts may not be for 2 years.
The QT continues at -60 billion/mo for Treasuries, -35 billion/mo for MBS. The large Treasury issuance will further reduce financial liquidity. The Fed balance sheet is declining. The Fed is keeping an eye on money-markets. But the Fed only watches the Treasury and fiscal (by Congress) actions.
The economy has slowed. The inflation has moderated but is still high (PCE +4.4%, core PCE +4.7%). The service inflation is sticky. The goal remains average +2% inflation to be achieved without causing much damage the the economy. Soft landing is possible. The labor market is tight and wages will rise, but slower growth will be desirable; labor demand still exceed supply. The consumer spending is also strong. The Fed can only watch the news on labor strikes.
Housing has slowed due to higher mortgage rates and lease renewals have been weak.
Regional banking has stabilized. Credit conditions has tightened. Many small banks have significant CRE exposures and some may have trouble. The Fed is keeping an eye on systemic risks in banks and nonbank financials (that is where problems were during the pandemic).
https://ybbpersonalfinance.proboards.com/post/1070/thread

I have been complaining about the above for over 10 years to Fidelity reps/supervisors. Several reps told me it's a finra/sec rules but it's not correct. It's Fidelity's own imposed rules.
As a trader, it's just annoying and wasting extra time. When I'm invested, I want to be in all the time and not wait an extra day since I hardly ever use the exchange feature by selling/buying funds from the same family funds. The use of 90% of the proceeds for the buy order is also annoying, especially when I sell bond funds on regular days when they move less than 0.5%
Over the years, I see a deterioration in the knowledgeable reps. Years ago, I hardly ever had any issues calling a rep to enter the buy trade, in the last couple of years, I get replies such as You can't do it and must wait another day or I need to change you a fee. In these cases, I ask to talk to a supervisor to solve the problem. It can take up to 30 minutes.
At Schwab it's a lot easier, I just enter the sell first, and seconds later, I enter the buy order, and I'm responsible to make sure the buy amount is small than the sell. In most cases, I trade bonds OEFS and why I use 99%. The process takes 1-2 minutes, and no reps are involved.

The dividend and cap gain distribution will be reinvest without transaction fee. You can to decide if the distribution goes to the sweep account (money market) or reinvest. Make sure you make this selection online.
Learned from @msf years ago, you can buy more later for $5 transaction fee using their automatic investment feature: schedule the purchase day and the $ amount. A second one is scheduled a monthly later but you can cancel it before the purchase date. As for selling TF funds, there is no transaction fee whereas Schwab charges the full transaction fee as buying.

@hank, I have been talking with Fidelity on this topic. D&C funds disappeared from Fidelity mutual fund listing in the last few weeks. Very strange since it was on their Transaction Fee platform for years. It is also strange that when you enter the D&C ticker symbol, nothing shows up. The representative cannot explain that either.
If you perform a trade on D&C fund (as testing), it will tell you the $2,500 minimum and $49.95 transaction fee. It seems that D&C funds are still sold through Fidelity but somewhere in the maintenance process it got foul up.
This needs to be resolved on Fidelity side before you perform the in-kind transfer. I would call their help desk.

@yogibb said,
FWIW, I like to receive some things via snail mail, but I am OK to get other stuff via email. So, on sites that allow selectivity (Fido, etc), I only get statements and 1099s via snail mail, but the rest (confirmations, prospectuses, junk) via email. But I resist all or nothing choice. It isn't just that I could save the PDFs, but that if something happens to me, my family won't have access to online a/c, info, statements, etc. Having some paper in hand still has value.

You got a point there; just in case something happen to me unexpectedly. I print out the year-end statement and keep them on a binder. Same go for Fidelity and other investments. Printed 1099s are made for doing tax returns. Over the years, I have gradually reduced receiving the paper forms and saving only the quarterly and annual statements; now only the annual statements. It is easier and keep track of them electronically.
My wife has access to all accounts and we spend time to review our finance. Not easy to plan for the unexpected and mental decline in the future. Reading @Lynn Bolin article is very helpful for seeking an advisor and perhaps to manage part of our asset.

I have invested in BL/FR bonds in last several years and managed to have a modest gain. Now it is time to rotate these bonds into longer duration investments grade bonds - treasury and corporate. If and when the recession arrives, the FED will cut rates and that will benefit the longer bonds as the bond prices appreciate. This may be one of those rare year where double digit total return is possible for some of these bonds.
I still have a high cash allocation in T bills, CDs, money market, and stable value. It is the sticky inflation (4%) that erode the 5% yield of the cash equivalents. As these cash equivalents mature every month, I will reinvest them in bond funds.

As noted, e-delivery waives annual fee at any asset level. This has been in place for several years.

Yes, it is 2023. Paper is sooooooo 2000's ;^) Think of how much logging/trees have been saved due to paper everything. (statement,bills,etc... etc..) I rarely get paper mail anymore other than junk mail and maybe...maybe use a stamp once or twice a year to mail something.

Over the years when I wanted to own/ trade bank loans, I used one of the following FAFRX,EIFAX,OOSAX.
WABAC, the only fund I have used instead of MM/CD YTD, was RPHIX. I don't trust any other funds.

As noted, e-delivery waives annual fee at any asset level. This has been in place for several years.

@Charles, check out Barron's,
TRADER. Stocks rose as the wall of worry faded away. The RALLY broadened beyond large-caps to small/mid-caps and cyclicals (financials, industrials). The SP500 was in a bear market for 248 days (Edit - the longest since 1948) and it may reach a new high that is +10% away. Of course, there are economic data, the FOMC meeting(s), and a possible recession along the way. Enjoy the rally while it lasts.
https://www.barrons.com/articles/stock-market-gains-as-wall-of-worry-crumbles-what-happens-next-75e1dc1e?mod=past_editions
You may be thinking of the time it took for the SP500 to recover fully, and that was about 5 years after the GFC; however, the allocation funds recovered much faster.

What am I missing here? The 2008/09 bear market, the 73/74 bear market were much longer and deeper than the one in 2022. And what about 2000-02?

Below are 3 posts about FR/BL, that I made on another MFO thread last week:
"I would just note that Floating Rate/Bank Loan category of bond funds, has been doing pretty well this calendar year. I continue to maintain a watchlist of about a dozen funds in the FR/BL category, and everyone of them has positive performance for one week, one month, 3 months, and YTD. The FR/BL category has historically performed well in Flat and Rising Rate Markets, TR performance has a positive trend this year, and rates do not seem likely to fall anytime soon."
"There is always a risk/reward decision to be made in investing in bond oefs. FR/BL did very well for many years, in the last 10 years, when rates were flat and certainly not rising. As a junk bond category, (most BLs are B rated), I frequently used them in the past, as a "lower risk" option for junk bond investing. When I read the Feds intentions regarding rates, I am not struck with the impression that a rate drop, is very likely this calendar year. On the contrary, I see the Feds raising rates very gradually the rest of the year, and trying to find their happy place for a smooth landing, and trying to keep inflation under control."
"I have a watchlist of about a dozen BL/FR funds. Everyone of them are positive for 1 week, 1 month, 3 month, and YTD. "If" I choose to put some money to work in this category, I would consider some of the lower risk options (according to SD and M*). A few examples include PRFRX, SAMBX, MWFLX, etc. TRowe Price PRFRX has a SD of 3.76, an M* Risk Rating of Below Average, TR of one week of .72/one month of .78/3 month of 1.26/YTD of 4.59. Metropolitan West MWFLX has a SD of 3.56, M* Risk Rating of Low, TR of one week of.60/1 month of .79/3 month of 1.77/YTD of 4.94."

Thank you Mark for this post information, and @yogibearbull for your added information, too. We've had accounts with Fido for 45 years, and the organization remains progressive and easy to deal with.

ROLL BREAKEVEN YIELD
What is the tradeoff between buying x-yr now and roll vs buying 2x-yr now?
Yield for x-yr now = ix%
Yield for 2x-yr now = i2x%
Roll Breakeven Yield for x-yr in x years = iroll%
The Roll Breakeven formula is:
iroll = 2*i2x - ix
Example: T-Bill 1-yr vs T-Note 2-yr, 6/11/23
1-yr 5.17%
2-yr 4.59%
Roll Breakeven 4.01%
So, if YOU think that 1-yr will be higher than 4.01% in 1 year, buy 1-yr T-Bill now and then roll; if YOU think that 1-yr will be lower than 4.01% in 1-yr, buy 2-yr T-Note now. So, YOU don't have to look for what the others in the media are saying.
https://ybbpersonalfinance.proboards.com/thread/456/roll-breakeven-yield

Water is the lifeblood for the western half of US. TSMC is following Intel who has built a plant in Phoenix many years ago. Clearly the management picked the location due to the largest $ and land granted by Arizona. Will see how this will plays out.
Again, we are getting off track on the topic of AI. As I posted above, my comment was

Another play in this AI space is the “picks and shovels” companies that enable this technologies. TSMC is the largest semiconductor foundries in the world in producing chipsets for many electronic devices including Apple. However, the geographical risk with China is causing many investors to pause.

Hard to separate water issues from anything in Arizona.
But to your second point, I wonder if the companies in the GRID etf are making a little money on all of this construction, and speculation. I find it hard to believe it's all due to infrastructure spending.

The day last week it was reported that Phoenix may limit housing tract permitting, water ETFs (PHO and FIW) jumped. I have owned the latter through thick and thin since 2018. SPY has returned about 55% for those 5 years, while the two water funds have gained some 75%. CGW, however, has lagged SPY.

...
One aspect of the CHIP Act is to bring manufacturing capabilities and capacities back to US. TSMC is on track to build a manufacturing plant in Phoenix, Az and another one in Germany. This will take several years to complete but it will stabilize the manufacturing capabilities in US and Western Europe.

So we were out at a club last weekend and via some mutual, professional friends, we met and spoke at length to one of the many Project Managers at the AZ site. The man has been a PM all of his career and engaged in many national/international high $ and high profile construction projects.
We asked him how things were progressing at the site.
Um, OUCH!
He related some stunning (and detailed) comments (that I won't detail here) about the company's lack of understanding and appreciation for the many layers of regulation, inspection and certification on US construction projects. For much of his time during the early stages of construction, he would get to the site, 'splain

again why they need to adhere to this/that regulation, tell them to Just Do It, and then go home for the day. Next day, rinse and repeat. In his over 30 years as a PM, he stated he's never seen anything approaching the issues on this job.
LOTS of other issues surround this project and they are being documented daily by local press, TV and the like. Online searches will easily locate many of the biggest issues.

Maybe they should have teamed up with ASU. Stuff sprouts out of the ground when they're involved, or even in the neighborhood. Maybe Phoenix codes are rougher than Tempe's, maybe.
I googled the TSMC project. Most of the stories revolved around serious cultural issues with the work force and the neighbors.
Intel OTOH, meets child care challenge, teams up with Maricopa Community college to offer free training.
Next thing you know Intel will be paying people to tear out the few remaining lawns and install water efficient toilets.
Maybe they can get our two utilities to get modern on distributed solar.
Axios has a good back-grounder on the Silicon Desert.