TCW Group, a downtown-based global asset manager, recently closed a $400 million collateralized loan obligation (CLO) fund.

This is the third new issue CLO close the firm has completed this year and the latest addition to TCW’s alternative credit assets under management, which have more than doubled since 2020, TCW said in a release.

CLOs are single securities often backed by low credit corporate loans or loans by private equity firms. With CLOs, investors can see higher yields with stronger liquidity but assume some associated risk. Depending on the structure of a CLO, risk can vary.

Currently, TCW operates 13 CLOs, managing more than $5.4 billion in assets.

Jerry Cudzil, a fixed income generalist portfolio manager, said TCW expects to continue on this path of growth and plans to find more equity partnerships next year.

“TCW continues to make significant investments in its credit capabilities across both public and private markets,” Cudzil said in a statement.

Last month, TCW also launched two new fixed income exchange-traded funds (ETFs).

First is the Multisector Credit Income ETF (MUSE) targeting long-term income by allocating investments across high-yield bonds, senior loans and emerging market credit based on market conditions.

The other is the AAA collateralized loan obligation ETF (ACLO) which gives investors access to the institutional CLO market with the highest rating of creditworthiness (AAA) with the goal of preserving capital and generating current income.

“The expansion of our ETF suite provides investors with a broader range of precision products that allow investors to capitalize on attractive alpha opportunities while actively seeking to mitigate downside risk,” Jennifer Grancio, global head of distribution at TCW, said in a statement.

Along with MUSE and ACLO, the firm also converted three fixed income mutual funds to ETFs, each with a different focus: high yield bonds with reasonable risk and high returns; corporate bonds with long-term returns; and senior loans to preserve capital.

These ETFs are now a part of the firm’s multisector bond fund, “TCW Flexible Income.”

“The new ETFs are characterized by focused bottom-up issue selection, active sector rotation and opportunities across a broader fixed-income investment universe,” TCW said in a release. “…The goal is to provide investors with transparency, intraday trading and price discovery.”