Weekly Market Summary

Extra Credit^*

• Collateralized Loan Obligation (CLO) ETF assets under management have surpassed $50 billion, as outperformance versus other fixed-income ETFs continues to draw both retail and institutional investors, according to a new report from Bank of America (BofA) Securities. The bulk of the market remains concentrated in higher-rated CLO strategies: BofA estimates that roughly $44.5 billion sits in US-listed ETFs focused on CLO securities rated AAA through A. Another $2.7 billion is allocated to BBB-and-below CLO ETFs, $2.7 billion to foreign-domiciled CLO funds with significant exposure to US deals, and roughly $200 million to private credit CLO ETFs.
• BofA analysts believe investors are rotating out of loan funds and traditional fixed-income mutual funds and ETFs and into CLO ETFs, attracted by the stronger risk-adjusted returns delivered by some of the category’s largest vehicles from Janus Henderson, Blackstone, and PGIM. PGIM added to that momentum last month with the launch of two new funds. “AAA-focused CLO ETFs have seen one of the highest returns YTD across fixed-income ETFs and have one of the highest Sharpe ratios,” the research note stated. “We continue to expect rotation out of loan ETFs into AAA CLO ETFs — higher returns on floating rate collateral with a much lower risk profile.”
• BofA sees evidence that some money market funds are starting to put capital into CLO ETFs, attracted by low duration and higher carry than short-dated Treasuries. The category’s growth has been led by large AAA CLO ETFs from managers such as Janus Henderson and PGIM. JAAA, the largest CLO ETF, had reached about $29 billion in assets as of July 8 after drawing nearly $5 billion of inflows since mid-June.

Source: Pitchbook as of 7/15/2026.