RCLO

The Reckoner BBB-B CLO ETF (RCLO) seeks to generate income and protect principal by investing primarily in U.S. dollar-denominated Collateralized Loan Obligations (CLOs). These CLOs are financial instruments issued by trusts or special purpose entities, which are collateralized by diverse pools of corporate loans, including senior secured, senior unsecured, and subordinate debt. The fund’s main focus is on floating-rate CLOs with credit ratings ranging from BBB+ down to B-. However, RCLO offers flexibility, permitting up to 70% of its portfolio in CLOs rated BB+ or lower, and up to 10% in those rated above BBB+. These investments can have any maturity and are sourced from both initial public offerings and the secondary market. The fund employs a rigorous bottom-up selection process, scrutinizing issuer management, the unique structure and underlying collateral of each CLO, its capacity to meet financial commitments, cash flow generation, and trading liquidity. As an actively managed ETF, RCLO can adapt its holdings as needed and may choose to retain downgraded CLOs if deemed beneficial. The fund also has the option to invest in other exchange-traded funds with similar investment objectives.