Highland Capital Management has hooked up with Pioneer Investment Management to raise a $650 million closed-end fund called Pioneer Floating Rate Trust. UBS and Merrill Lynch have underwritten the fund, which launched just before Thanksgiving. The fund will invest in senior secured loans, but can also invest in second-lien loans, collateralized loan obligations, credit default swaps and indexes, such as the SAMI. A Highland official declined comment.
Highland acquired a significant retail presence when it bought the bank loan business of Columbia Management Advisors (LMW, 4/14). These funds, which total approximately $1.6 billion, are among the best performing closed-end funds according to Lipper data (11/29). They are showing one-year returns of 7-10%.