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A Good--and More Liquid--Choice Among Bank-Loan Funds

Bronze-rated Virtus Seix Floating Rate High Income has a solid long-term record and low fees.


Brian Moriarty: Investors in the market for a bank-loan fund should consider Virtus Seix Floating Rate High Income. This Bronze-rated fund has low fees and is run by a strong team executing a solid process. The team looks for companies with improving cash flows, strong management teams, and access to liquidity.

The fund's focus on liquidity is one of its notable characteristics. The team tends to avoid smaller loans, which are less liquid in the secondary market, and they try to settle trades faster than many peers. This is important because bank loans have very long settlement times, so speeding up this process is a competitive advantage compared to many bank-loan-fund peers.

Brian Moriarty does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.