AIG Senior Floating Rate Fund

Class A: SASFX • Class C: NFRCX • Class W: NFRWX

Access the Potential for Attractive Rising Yields

One of the most powerful features of senior bank loans is their ability to increase yields as interest rates rise. Typically, bond prices move in the opposite direction of interest rates, so as rates increase, the value of most bonds will fall. 

However, with senior bank loan investments like the AIG Senior Floating Rate Fund, the opposite may be true. Since yields of senior floating rate bank loans regularly reset with market rates, the Fund has the potential to provide rising income without eroding bond prices—even in an inflationary interest rate environment. 

Highlights of the Fund include:

  • Senior Secured Loans—these loans are typically issued by banks and secured by collateral, placing them at the highest priority in the capital structure. This can provide credit protection in times of economic uncertainty.
  • Potential Hedge Against Rising Interest Rates—Treasury yields are at historic lows. With interest rates likely to increase eventually, the Fund with its adjustable yield may be one of the few fixed-income investments that will perform well in this market environment.
  • High Current Yield—the Fund invests in bank loans, which offer attractive yields relative to many fixed-income investments in today’s market.

The Strength of Wellington Management

The Fund is managed by Jeffrey Heuer of Wellington Management, one of the largest asset managers in the industry and also one of the most experienced credit managers with an entire team dedicated to bank loans. Jeff and his team perform extensive credit analysis, looking for loans that offer attractive income characteristics at good values. 

For more information on the AIG Senior Floating Rate Fund, please talk to your financial advisor.

Senior floating rate funds are not money market funds; their NAVs will fluctuate and may lose value. Investment in these loans involves certain risks, including among others: risks of nonpayment of principal and interest; collateral impairment; non-diversification and borrower industry concentration; and lack of full liquidity. High yield debt instruments carry a greater default risk and may be more volatile, less liquid, more difficult to value and more susceptible to adverse economic conditions or investor perceptions than other debt instruments.