Rate limbo is steering the ETF industry’s next push toward CLOs
The current uncertain interest rate environment is driving increased interest in Collateralized Loan Obligations (CLOs) within the Exchange-Traded Fund (ETF) market. Experts like Todd Rosenbluth of VettaFi suggest CLOs are the next frontier for ETF innovation, offering attractive yields and relative stability through short-duration, floating-rate secured loans. While new CLO ETFs are launching, advisors are cautiously incorporating them as supplementary holdings rather than core investments, with a focus on higher-rated tranches to mitigate risk.
- Entities
- Company: Reckoner Capital Management
- Topic: Exchange-Traded Fund
- Company: TCW Group
- Person: Todd Rosenbluth
- Topic: Interest Rates
- Topic: Collateralized Loan Obligations
- Company: VettaFi
- Person: Jennifer Grancio
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