iShares BBB-B CLO Active ETF (BCLO)

The iShares BBB-B CLO Active ETF (BCLO) is an actively managed fixed-income fund from iShares, the ETF business of BlackRock.

The fund invests mainly in debt tranches of collateralized loan obligations (CLOs) that are rated in the BBB through B range. CLOs are securitized vehicles that pool large numbers of floating-rate senior secured loans made to companies, and then issue notes in tranches with different levels of priority. The tranches this fund targets sit in the middle and lower part of the capital structure, offering higher income in exchange for more credit risk than AAA-rated CLO debt.

Because CLO coupons generally reset with short-term interest rates, the fund's income tends to be floating rate. BlackRock's portfolio managers select individual CLO tranches based on credit analysis of the underlying loans and the CLO managers, rather than tracking an index.