Franklin Templeton has launched a collateralised loan obligation (CLO) exchange-traded fund (ETF) investing across US and European markets.
The fund, named Franklin BSP CLO ETF (YCLO), will invest in investment-grade CLO debt tranches, the asset manager said.
The ETF will be managed by Franklin Advisers, with sub-advisory services provided by Benefit Street Partners (BSP), Franklin Templeton’s alternative credit specialist investment manager, overseeing $93bn (£69.2bn) in assets under management.
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“YCLO provides access to a compelling institutional asset class that offers floating-rate income, structural protections, and diversification potential within traditional fixed income portfolios,” said Cathy Bevan, global head of BSP structured credit. “What differentiates YCLO is the ability to invest dynamically across both US and European CLO markets.”
BSP’s Structured Credit platform manages more than $9bn in assets under management, with the YCLO strategy led by Bevan and Brandon Chao.
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“The CLO market and its investor base have continued to grow, while performance across CLO securities has become more differentiated in today’s market environment,” said Chao, portfolio manager at BSP structured credit. “This creates opportunities for BSP to apply its global relative value approach and active risk management within an ETF structure.”
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