Janus Henderson has entered Europe’s nascent active fixed income ETF market with a strategy capturing AAA-rated collateralised loan obligations (CLOs).
The Janus Henderson Tabula EUR AAA CLO UCITS ETF (JCL0) will list on Deutsche Boerse with a total expense ratio (TER) of 0.35%. The ETF will list on the London Stock Exchange and Borsa Italiana in due course.
JCL0 will be managed by secured credit head Colin Fleury and secured credit portfolio managers Denis Struc and Ian Bettney.
The ETF will invest primarily in European AAA-rated CLO issuance and up to 30% in non-European AAA CLOs that are compliant with European securitised regulations.
Janus Henderson’s securitised investment team is comprised of six portfolio managers responsible for over $36bn assets under management (AUM) globally, with CLOs representing a “substantial portion” of these assets, the firm said.
Fleury commented: “AAA CLOs are a compelling alternative to investment grade corporates, typically offering higher yields and more credit spread for a better-quality asset with lower sensitivity to interest rate volatility. They can significantly enhance clients’ potential to achieve higher levels of income in their fixed income or cash allocations."
Michael John Lytle, CEO of Tabula, added: "AAA CLO ETFs have been one of the most important innovations in the global ETF market in recent years. The specialised expertise required to construct robust CLO portfolios means that a dedicated team like the one at Janus Henderson is key to making this asset class accessible to a broader audience.”
JCL0 becomes the latest addition to Janus Henderson’s European active ETF roll-out, following high conviction Japan and Europe equity offerings in October and November, respectively.
It also comes as CLOs become a launch focus for ETF issuers in Europe, with Invesco filing to launch a pair of CLO ETFs with the Central Bank of Ireland (CBI) after understanding that the regulator is set to change its stance on the exposure.
