BKLN vs SPHY

BKLNCInvesco Senior Loan ETF

SPHYAState Street SPDR Portfolio High Yield Bond ETF

In short

BKLN The original senior loan ETF, trading since 2011. It owns the 100 largest, most liquid leveraged loans: floating rate, senior secured, below investment grade. Credit risk in place of interest rate risk.

SPHY State Street's junk-bond workhorse: roughly 1,900 US high yield bonds in one wrapper for 0.05% a year, a fraction of what the typical high yield ETF charges, with income paid monthly.

Stated mandate

BKLN The fund provides exposure to the largest and most liquid senior secured loans by tracking the Morningstar LSTA US Leveraged Loan 100 Index.

SPHY The fund seeks to track, before fees and expenses, the price and yield performance of the ICE BofA US High Yield Index.

Why people hold it

• BKLN Coupons float off short-term rates and reset, so income follows rates up or down instead of fighting them. Duration is minimal, unlike a fixed-coupon bond fund.invesco.com
• Senior secured loans sit at the top of a borrower's capital stack, ahead of bonds and equity, backed by collateral (which may not always be enough to cover the loan).invesco.com
• The index screens for the 100 largest, most liquid loan facilities, so the portfolio (about 170 positions) stays in paper that actually trades.invesco.com
• A multi-billion-dollar fund and one of the most actively traded doors into the loan market, a corner investors usually reach through slower mutual fund wrappers.invesco.com

• SPHY 0.05% a year against a peer-group median about eight times higher. In high yield, the fee comes straight out of coupon income, so the gap does real work.
• Holds about 1,900 bonds tracking the ICE BofA US High Yield Index, broad enough that no single issuer's trouble dominates the portfolio.ssga.com
• Live since 2012, a multi-billion-dollar fund that trades actively and has stuck tightly to its stated index rather than drifting from the mandate.
• Distributions arrive monthly, in step with how the underlying coupons come in.

Worth knowing

• BKLN 0.65% net of a waiver through August 31, 2027 (0.67% gross) sits above the category median and well above plain high-yield bond ETFs like SCYB at 0.03% or SPHY at 0.05%.
• Leveraged loans are below investment grade by design and settle slower than bonds, so a fund trading them daily carries real credit and liquidity risk.saytechnologies.cominvesco.com
• Floating coupons cut both ways: the monthly payout moves with short-term rates and credit conditions, so there is no fixed income level to plan around.invesco.com

• SPHY This is below-investment-grade credit. Defaults and spread moves drive the price far more than Treasury yields do, and sell-offs in this asset class can be sharp.
• Fees here are already near the floor: SCYB lists 0.03% and HYLB matches at 0.05%, so the cost edge over the strongest peers is narrow.
• Scope is US high yield corporates, full stop. No investment-grade ballast, no emerging market debt, nothing to soften a credit drawdown from inside the fund.ssga.com

Full BKLN profile⁠

Full SPHY profile⁠