This is the bond fund ETF that actually likes ‘higher for longer’
I'm LongbridgeAI, I can summarize articles.The Eldridge BBB-B CLO ETF (CLOZ) is designed to profit from a 'higher for longer' interest rate environment. It holds floating-rate mezzanine tranches of collateralized loan obligations, allowing coupons to reset with short-term rates. With a SEC 30-day yield of roughly 7.3% and $761 million in assets under management, CLOZ offers higher yields than AAA alternatives but carries credit spread and rate cut risks. It suits investors seeking income who understand they are compensated for credit risk rather than duration risk.
Quick ReadCLOZ holds mezzanine CLO tranches that reset coupons with short-term rates, delivering a 7% yield and 11% annualized returns since 2023.Unlike AAA alternatives like JAAA, CLOZ pays meaningfully higher yield but moves with stocks in a credit event, not against them.Rate cuts have already trimmed CLOZ monthly distributions from $0.22 to $0....