BlackRock’s AAA CLO ETF Will Track Top-Rated U.S. Securities

The largest issuer of exchange-traded funds in the world is making significant investments in the expanding fixed-income securities market.

The BlackRock AAA CLO ETF invests at least 80% of its assets in highly rated US collateralized loan obligations, per a filing with the Securities and Exchange Commission.

The application suggests greater customer demand BlackRock

Early proposals for such funds were viewed with suspicion by veterans of the market, but as inflation and interest rates rose, CLO-backed floating-rate loans gained popularity.

According to Balciunas, Senior ETF Analyst at Bloomberg Intelligence, “BlackRock has been considerably more cautious with their new filings lately, so if they are asking for a CLO ETF, it must suggest they are seeing some genuine demand from their clients.”

Henderson, Janus Since its debut two years ago, AAA CLO, an exchange-traded fund, has accumulated assets worth almost $1.6 billion, with a total revenue decline of roughly 1% in 2022.