The fund is subadvised by PineBridge Investments, a private global asset manager focused on active, high-conviction investing.
“The growth of the CLO market has been driven by the benefits they provide, including enhanced yields versus equivalently rated bonds and loans and their considerable structural protections. In today’s rising rate environment, the floating rate coupons of CLOs make them particularly attractive,” said William Sokol, senior ETF product manager at VanEck, in a release. “We’re excited to launch CLOI with PineBridge at a time when investors looking for enhanced income and risk protection have few options.”
Laila Kollmorgen, portfolio manager, CLO tranche, at PineBridge Investments added: “Our institutional clients have understood the strong value proposition of our CLO strategies for more than 20 years, and we are looking forward to extending access to this market to a broader investor base. I’m looking forward to partnering with VanEck on this strategy, which aims to allow investors to combine the value of CLOs with the transparency, liquidity and costs benefits of an ETF.”
CLOI exposure focuses primarily on investment-grade CLOs. The ETF combines VanEck’s expertise in income-focused investment solutions with the established active management of PineBridge, a $146 billion private global asset manager focused on active, high-conviction investing across various asset classes.
PineBridge is both a CLO manager and an active investor in CLO tranches, and it leverages a rigorous, time-tested investment process with disciplined portfolio construction, robust risk management, and a foundation in credit-intensive research. PineBridge has $13.6 billion in subadvised assets as of March 31.
“We believe this new strategy will be an attractive and timely complement to our income solutions lineup, which includes differentiated, enhanced and less correlated sources of yield relative to traditional fixed income asset classes. We believe CLOI will allow investors of all types to potentially benefit from the relatively high income, risk protections and floating rate exposure that CLOs provide,” added Ed Lopez, head of product management at VanEck.
CLOI joins VanEck’s lineup of ETFs that includes the VanEck Vectors Investment Grade Floating Rate ETF (FLTR ), which invests in U.S. denominated floating-rate notes issued by corporate issuers and rated investment-grade; the VanEck Fallen Angel High Yield Bond ETF (ANGL ), which offers exposure to high yield bonds originally issued as investment-grade; and the VanEck Vectors BDC Income ETF (BIZD ), which invests in publicly traded business development companies.
CLOI is listed on the NYSE and has a total expense ratio of 0.4%.
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