CLOA
JAAA
Another ETF walks into the CLO bar
New York Life Investment Management has launched the NYLI Investment Grade CLO ETF, ticker CLOO, giving income-hungry investors yet another tool in the structured-credit toolbox. Think of it like the ETF version of ordering the safer item on a spicy menu: you still want the yield, but you’d rather not set your portfolio on fire.
Why investors care
The fund will mostly buy investment-grade CLO tranches, with at least 80% of assets parked in highly rated pieces of the stack. In plain English: it’s trying to collect decent income while putting some guardrails around the downside.
That matters because fixed income has been doing its best impression of a crowded subway car lately — lots of people are piling in, and the search for yield is getting intense. Investors have been leaning into CLO ETFs because they can offer higher income than plain-vanilla corporate bond funds, along with a bit of structural protection.
The bigger CLO parade
CLOO isn’t arriving alone. It’s joining a growing club that already includes familiar names like Janus Henderson AAA CLO ETF JAAA and iShares AAA CLO Active ETF CLOA, both of which have been pulling in serious cash this year. Over the past three months, JAAA has drawn more than $660 million in inflows, while CLOA has taken in over $600 million.
Big picture
This launch says one thing pretty loudly: investors are still hunting for income, and they’re willing to get a little more creative to find it. When rates stay elevated and credit nerves stay twitchy, products like CLOO suddenly look a lot less niche and a lot more mainstream.