FCT: Another CEF Bites The Dust (Rating Downgrade)
First Trust Senior Floating Rate Income Fund II has been downgraded to a 'Hold' rating due to a narrowing discount to NAV. The fund is set to convert to an ETF, which is expected to reduce risk and volatility. However, this conversion will also eliminate the leveraged exposure to floating rate loans.
- ▪First Trust Senior Floating Rate Income Fund II is downgraded to 'Hold' as its discount to NAV has narrowed to -1%.
- ▪The fund's conversion to an ETF is pending a shareholder vote in June 2026.
- ▪Post-conversion, the ETF will offer less risk and volatility but will not provide leveraged exposure to floating rate loans.
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