Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Interest rates are at historical lows. Most fixed rate securities and funds offer low yields, and could suffer sizable losses if rates normalize. Floating rate funds, including BKLN, can help reduce interest rate risk, and can help investors profit from rising interest rates.
Most investors should never own FR(floating rate) funds. The risk/reward isn't good. You can get high distributions with funds like PIMIX but with better risk/reward, In 2020 BKLN lost over 20% as of 3/23/2020.
Rates are not going up because the Fed told us that. The only time many bond categories suffer sizable losses is when rates rise very quickly within several weeks.
As bond OEF trader I use FR short term when FR have a great momentum and the Fed tell us they are going to raise rates like they did couple of years ago.
Comments
The risk/reward isn't good.
You can get high distributions with funds like PIMIX but with better risk/reward,
In 2020 BKLN lost over 20% as of 3/23/2020.
Rates are not going up because the Fed told us that. The only time many bond categories suffer sizable losses is when rates rise very quickly within several weeks.
As bond OEF trader I use FR short term when FR have a great momentum and the Fed tell us they are going to raise rates like they did couple of years ago.