Two Blokes

CLOB: Great CLO Fund, Timing Is Not Good

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    Posted by Two Blokes May 3 - Filed in Stock - 4 views
    The VanEck AA-BB CLO ETF offers a mixed portfolio of AA to BB CLO tranches, aiming for high current income with a 7.25% SEC yield. Despite its robust structure and low default probabilities, the ETF experienced a -6% drawdown recently and could see -10% in a mild recession. CLOs face liquidity issues and market risk, making them vulnerable to price drops during economic downturns, despite strong fundamental credit risk profiles.