BKLN vs USHY

BKLNCInvesco Senior Loan ETF

USHYAiShares Broad USD High Yield Corporate 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.

USHY The wide-angle lens on junk bonds: about 1,900 US dollar high yield corporate issues for 0.08% a year, a fifth of what the typical fund in its category charges. Broad, cheap, heavily traded, and it pays 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.

USHY The fund seeks to track an index of U.S. dollar-denominated high yield corporate bonds.

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

• USHY Charges 0.08% a year while the median high yield fund in its cohort runs 0.40%. Cheap rent on an expensive-to-run corner of the bond market.
• Holds about 1,900 bonds against the ICE BofA US High Yield Constrained Index: the broad market, not a curated slice of the most liquid names.ishares.com
• A multi-billion-dollar fund and one of the more actively traded in high yield, which tends to keep bid-ask spreads thin even on busy days.
• Pays monthly and has tracked its index tightly since its 2017 launch, one of the closer index matches in its peer group.

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

• USHY High yield means below-investment-grade borrowers. When credit gets stressed this asset class drops with stocks instead of cushioning them.
• Cheaper tickets sit on the same shelf: SCYB at 0.03% and SPHY at 0.05%.
• This is a fund, not a bond ladder. No maturity date hands your principal back; the basket rolls on indefinitely.

Full BKLN profile⁠

Full USHY profile⁠