Market updates and sector developments

Angel Oak Capital Advisors, based in Atlanta, has announced its Ultra Short Income ETF, chiefly invested in ABS, has grown to over US$100m in assets under management in the year since launch. Most ultra short ETFs with assets of a year or less in duration are invested in commercial paper and Treasury bills, but Angel Oak perceived a gap in the market for such a fund mainly devoted to ABS.

Up to 50% of the fund is invested in investment grade consumer credit ABS, such as prime auto loans, credit cards loans and online loans. The remainder is variously distributed into mortgages, CLOs and corporate credit.

“We saw a huge opportunity in the short duration ETF space,” says Clayton Triick, senior portfolio manager at Angel Oak. “There are very few ultra short ETFs in ABS and we’ve seen a dramatic yield pick up in securitized instruments this year.”

The Ultra Short Income ETF was also Angel Oak’s debut in the ETF market.