Another warning on bank loan funds

|By:, SA News Editor

"A sudden mass exit from the ETF would be a problem and we've capped our investment in it for that reason," says RiverFront's Rod Smyth of the PowerShares Senior Loan Portfolio (BKLN).

Not a crank on senior loans, Smyth's group was a seed investor in this particular ETF, but the size and illiquidity of the bank loan market combined with its recent popularity has turned him cautious.

Earlier: Bank loan funds'defense against interest rate risk may be overrated.

Other ETFs: SRLN, SNLN, FTSL