NCLO ETF: What Is It? Returns, Expense Ratio, Holdings, and Alternative ETFs Explained
The Nuveen AA-BBB CLO ETF (NCLO) is an actively managed income product that invests in investment-grade CLO tranches. Its higher dividend potential relative to ETFs concentrated in the top rating tier, the balance against credit risk, and differences in fees and rating mix versus competitors such as JAAA and PAAA are the key selection criteria.
SubscribeWhat Is the Nuveen AA-BBB CLO ETF?
This is an actively managed ETF that invests broadly in investment-grade CLO (collateralized loan obligation) tranches. It targets the investment-grade range from AA+ down to BBB-, with an emphasis on A tranches, aiming for higher income than products focused on the top rating tier.
It suits bond investors who want floating income at roughly short-term interest rate levels and are willing to accept some degree of credit risk.
It is an ETF run by Nuveen using an active management approach.
How Does the Nuveen AA-BBB CLO ETF Invest?
| Item | Details |
|---|---|
| Tracked Index | No benchmark (actively managed) |
| Management Style | Active (discretionary security selection) |
| Rebalancing Frequency | Ongoing (at the discretion of the management team) |
| Dividend Frequency | Monthly |
| Issuer | Nuveen |
| Expense Ratio | 0.26% |
The fund actively trades investment-grade tranches of collateralized loan obligations managed by third parties, seeking a high level of current income. It diversifies across the investment-grade range from AA+ to BBB- while giving greater weight to A tranches, a structure that lifts both income and credit risk compared with strategies concentrated in the top rating tier.
- Active allocation across the AA-BBB range, moving beyond a top-tier concentration
- Floating-rate CLO exposure that offers resilience when interest rates rise
Nuveen AA-BBB CLO ETF Size and Costs (AUM and Management Fee)
Assets under management (AUM) stand at $243.9M, and the expense ratio is 0.26% per year.
By widening the rating range compared with top-tier CLO ETFs, the fund tends to deliver higher income, but it is also more sensitive to changes in credit spreads.
Nuveen AA-BBB CLO ETF Performance and Trends
1-Year Price Performance
Dividend & Yield
52-Week Price RangeBecause CLO tranches have a floating-rate structure, distributions and prices move with the short-term rate environment and credit spreads. The higher rates stay, the more favorable the income picture tends to be in relative terms.
Growing interest in private lending and structured credit has kept investor attention on the CLO ETF category as a whole. This ETF is a relatively recent active launch, and its asset base is still building gradually.
Nuveen AA-BBB CLO ETF Pros and Cons
Its strengths are higher income from the broader AA-BBB range and resilience to rising rates. Its weaknesses are greater credit risk than top-tier products and dependence on active management.
💪 Key Strengths
⚠️ Points to Watch
Nuveen AA-BBB CLO ETF Alternative ETFs and Related Products
JAAA, PAAA, and CLOA in the table concentrate on top-rated CLO tranches and are direct substitutes with lower credit risk, while NCLO differs by extending into the AA-BBB range to boost income. VanEck's CLOI is another actively managed CLO product worth comparing, and FSEC, which holds a broad range of structured bonds, can also be considered. Fees, credit rating mix, and whether the fund is actively managed serve as the selection criteria.
Peer Comparison ETFs| Ticker | Name | Price | Change | AUM | Total Expense Ratio | Dividend Yield | 1Y |
|---|---|---|---|---|---|---|---|
 JAAA | Janus Henderson AAA CLO ETF | $50.49 | +0.1% | $32.4B | 0.20% | 4.82% | -0.5% |
 PAAA | PGIM AAA CLO ETF | $51.32 | +0.0% | $15.0B | 0.19% | 4.63% | -0.3% |
 FSEC | Fidelity Investment Grade Securitized ETF | $42.71 | -0.1% | $4.6B | 0.36% | 4.57% | -3.8% |
 CLOA | iShares AAA CLO Active ETF | $51.77 | -0.4% | $2.8B | 0.20% | 4.74% | -0.3% |
 CLOI | VanEck CLO ETF | $52.78 | -0.4% | $1.8B | 0.36% | 4.61% | -0.5% |
Top Holdings| Ticker | Name | Weight | Price | Change | Market Cap | P/E | Dividend Yield |
|---|---|---|---|---|---|---|---|
 PSBD | Palmer Square Capital BDC Inc | 0.06% | $10.07 | +1.4% | $308.7M | - | 14.97% |
 GBDC | Golub Capital BDC Inc | 0.03% | $12.89 | +1.3% | $3.3B | 19.8 | 10.71% |
 TSLX | Sixth Street Specialty Lending Inc | 0.01% | $18.17 | +3.1% | $1.7B | 19.3 | 9.52% |
 MYMK | State Street My2031 Municipal Bond ETF | 0.01% | $24.66 | -0.0% | $0.0M | - | 2.61% |
Nuveen AA-BBB CLO ETF Investor Checkpoints
Here are the points to review before investing in NCLO. Because income is higher, investors should confirm the credit rating mix and the risks unique to structured products in advance, and it is wise to also weigh fees against peer CLO ETFs, the liquidity environment, and currency exposure.
| Checkpoint | What to Check | Current Status |
|---|---|---|
| 💵 Expense Ratio | Compare fee level against peer CLO ETFs | In line with category average |
| 📊 Credit Rating Mix | Check the weight of lower-rated tranches versus the top tier | Centered on AA-BBB |
| 💧 Liquidity | Check trading conditions for structured bonds | Needs verification |
| 💱 Currency | Impact on returns converted into won | Not currency-hedged |
Wider credit spreads and tighter liquidity in structured products are the main drivers of short-term volatility. During a credit crunch, price declines can be larger than for products concentrated in the top rating tier.
The fund suits investors who want higher income than CLO ETFs focused on top-rated tranches and are willing to accept credit risk. Those who place more weight on stability are encouraged to compare top-tier concentrated products such as JAAA, PAAA, and CLOA before choosing.
SubscribeDisclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
This article reflects information as of June 26, 2026.
Today's 5 AI picks, all free