For investors seeking momentum, Invesco Senior Loan ETF (BKLN Quick QuoteBKLN - Free Report) is probably on the radar. The fund hit a 52-week high and is up about 6% from its 52-week low price of $20.06/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:

BKLN in Focus

Invesco Senior Loan ETF follows the Morningstar LSTA US Leveraged Loan 100 Index, which is designed to track the market-weighted performance of the largest institutional leveraged loans based on market weightings, spreads and interest payments. It charges 65 bps in annual fees (see: all the High-Yield/Junk Bond ETFs here).

Why the Move?

The senior loan corner of the bond market has been an area to watch lately given the speculations over the higher interest rates for a longer-than-expected period. Senior loans are floating rate instruments and thus pay a spread over the benchmark rate like LIBOR, helping in eliminating interest rate risk. When interest rate rises, coupons on senior loans increase while the value of the bonds decline, keeping investments stable.

More Gains Ahead?

BKLN might continue its strong performance, given its weighted alpha of 2.60 and a low 20-day volatility of 2.89%.