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Q&A with Janus Henderson

June 26, 2023
Jessica Shill headshot
Jessica Shill

Portfolio Manager, Janus Henderson

This week we sit down with Jessica Shill at Janus Henderson to discuss the company’s views and support of the active ETF market.

Janus Henderson’s active ETF suite now includes 10 ETFs across both equity and fixed income with more than $6.5 billion in AUM, including nearly $3.0 billion in NYSE Arca-listed JAAA. How has the active ETF market for fixed income ETFs evolved since JAAA listed in late 2020?

Markets have proven more volatile in recent years and investors have shown greater interest because of the combined benefits of active management and the ETF structure.

In addition, the changing composition of the U.S. bond market over the last decade has contributed to the rapid growth of active fixed-income ETFs. Passive index-related strategies have become more concentrated in government debt, which tends to have lower yields relative to other areas of the fixed income universe.

In our view, the interest in actively managed ETFs will continue to expand within fixed income because portfolio management teams can add value while managing risk.

Why did you decide on the ETF wrapper for your CLO ETFs (JAAA)? And why actively managed?

We have a long history of investment in the collateralized loan obligations (CLOs) market, and we felt that the market was large and liquid enough for an ETF wrapper. Additionally, we believe the ETF wrapper is the most liquid and transparent way to give investors access to the CLO market.

There are two reasons why the Fund is actively managed:

  1. It is impossible to recreate the benchmark for these types of funds.
  2. When investing in the CLO market, one cannot blindly buy securities to match a benchmark. There is a significant amount of due diligence and underwriting involved to ensure that we are buying bonds from issuers who will perform in line with market expectations and that will offer our investors consistent risk-adjusted returns.

What trends do you see in the fixed income market that could benefit CLO ETFs, and which trends could create headwinds?

Short-term interest rates have risen far more than intermediate- and long-term rates in the current tightening cycle. The resulting inverted yield curve has presented investors with the rare opportunity to earn higher yields with less interest-rate risk. In our view, AAA-rated CLOs currently offer a compelling option to access higher yields within the short-duration universe.

Much of the downside in the CLO market today centers around weakening fundamentals in the bank loan market and increasing recession risk. Downgrades and defaults in loans continue to increase, and we expect this to continue through year-end 2023. That said, we believe that this downside is currently priced into CLO spreads as all tranches are still trading wide of historical averages.

Additionally, the arbitrage gap is presently a headwind for the CLO primary market as it is not economical for most issuers to issue a deal at current levels. Therefore, we expect issuance to remain muted in 2023.

What are the key considerations that investors should contemplate when considering actively managed ETFs?

In our view, there are three considerations: The principal investment strategy, portfolio construction, and liquidity of the vehicle.

The principal investment strategy is different across all outstanding CLO ETFs. Some funds allow for investing across the CLO capital stack, while others allow for investment in both middle market and broadly syndicated CLOs. It is imperative to understand these differences because the risk-reward profiles of these funds could vary greatly.

Additionally, it is important to know how each manager manages their portfolio (for example, how are they selecting what issuers to buy, are they sourcing from the primary or secondary market, etc.) to better understand how the fund will be managed going forward.

Perhaps the most critical consideration is the liquidity of the ETF, since that is ultimately what investors are buying. Investors should consider what percentage of the fund’s total AUM their investment will be, how many shares trade daily, and what the bid/ask spread of the vehicle is, as these will all affect the execution level of the purchase and sale of the fund.

Active ETF Stat Pack

# of Issuers232
# of New Issuers 202323
# of ETFs1059AUM ($B)$403.89
# of New Launches 20231073 Yr AUM CAGR53%
Avg. ER0.44%5 Yr AUM CAGR49%
Cash FlowTrading
YTD Cash Flow ($B)$26.52YTD ADV (Shares)128,751,721
3 Yr Cash Flow$254.52YTD ADV ($)$4.22 B
5 Yr Cash Flow$315.34YTD Avg. Spread (bps)*31.02

Source: Factset & NYSE Internal Database and Consolidated Tape Statistics as of 6/9/2023

*Simple average

Active, Semi-Transparent ETFs

TickerInceptionNameAUMYTD Flows30 Day Median Spread (bps)ADV (shares)StructureLMMExpense Ratio
EQOP9/17/20Natixis U.S. Equity Opportunities ETF$9,950,682$243,31115.4546NYSE AMSCitadel0.85%
VNSE9/17/20Natixis Vaughan Nelson Select ETF$29,837,111$15,462,38414.267,788NYSE AMSCitadel0.80%
VNMC9/17/20Natixis Vaughan Nelson Mid Cap ETF$7,584,489$289,30214.06144NYSE AMSCitadel0.85%
ESGA7/15/20American Century Sustainable Equity ETF$136,456,150$9,749,17114.335,211NYSE AMSCitadel0.39%
MID.ETF7/15/20American Century Mid Cap Growth Impact ETF$42,104,022$9,699,06813.623,534NYSE AMSCitadel0.45%
ESGY7/1/21American Century Sustainable Growth ETF$10,546,692$2,741,30610.751,124NYSE AMSCitadel0.39%
NDVG8/5/21Nuveen Dividend Growth ETF$8,269,664$250,3218.56267NYSE AMSCitadel0.64%
NSCS8/5/21Nuveen Small Cap Select ETF$5,820,308$012.4977NYSE AMSCitadel0.85%
NWLG8/5/21Nuveen Winslow Large-Cap Growth ESG ETF$5,592,050$188,8619.65159NYSE AMSCitadel0.64%
NUGO9/28/21Nuveen Growth Opportunities ETF$2,731,203,412$72,062,6259.06126,879NYSE AMSCitadel0.55%
SAEF11/16/21Schwab Ariel ESG ETF$15,295,000$1,157,40042.322,364NYSE AMSFlow Traders0.59%
IWLG6/23/22IQ Winslow Large Cap Growth ETF$20,374,250$3,717,51022.621,267NYSE AMSCitadel0.60%
IWFG6/23/22IQ Winslow Focused Large Cap Growth ETF$6,657,210$022.70147NYSE AMSCitadel0.65%
TSME10/5/22Thrivent Small-Mid Cap ESG ETF$134,106,851$58,368,21210.0420,964NYSE AMSRBC0.65%
JPSV3/8/23JPMorgan Active Small Cap Value ETF$10,854,800$957,35010.55841NYSE AMSCitadel0.74%
FDG4/2/20American Century Focused Dynamic Growth ETF$173,148,444$11,542,92510.5110,066ActiveSharesCitadel0.45%
FLV4/2/20American Century Focused Large Cap Value ETF$234,256,202$12,229,75610.648,341ActiveSharesCitadel0.42%
FBCG6/4/20Fidelity Blue Chip Growth ETF$541,890,000$67,854,53127.35109,551Fidelity ProxyGTS0.59%
FBCV6/4/20Fidelity Blue Chip Value ETF$130,617,400-$9,526,38527.6318,186Fidelity ProxyGTS0.59%
FMIL6/4/20Fidelity New Millennium ETF$88,915,180-$798,86823.1212,237Fidelity ProxyGTS0.59%
FGRO2/4/21Fidelity Growth Opportunities ETF$153,411,510$83,720,05517.1483,605Fidelity ProxyCitadel0.59%
FMAG2/4/21Fidelity Magellan ETF$45,952,035$40,27111.388,268Fidelity ProxyRBC0.59%
FPRO2/4/21Fidelity Real Estate Investment ETF$14,440,550-$2,050,74612.823,127Fidelity ProxyCitadel0.59%
FSMO2/4/21Fidelity Small/Mid-Cap Opportunities ETF$30,190,153$2,218,2399.055,073Fidelity ProxyRBC0.60%
FSST6/17/21Fidelity Sustainability U.S. Equity ETF$8,940,645$952,51211.561,362Fidelity ProxyRBC0.59%
FDWM6/17/21Fidelity Women's Leadership ETF$2,687,400$346,52213.361,445Fidelity ProxyRBC0.59%
TCHP8/5/20T. Rowe Price Blue Chip Growth ETF$363,787,216$15,251,9489.7797,160T Rowe ProxyVirtu0.57%
TDVG8/5/20T. Rowe Price Dividend Growth ETF$324,578,079$43,176,1229.2854,977T Rowe ProxyRBC0.50%
TEQI8/5/20T. Rowe Price Equity Income ETF$102,689,058$4,896,8158.7413,403T Rowe ProxyVirtu0.54%
TGRW8/5/20T. Rowe Price Growth Stock ETF$48,478,138$2,443,52610.126,259T Rowe ProxyRBC0.52%
TSPA6/8/21T. Rowe Price U.S. Equity Research ETF$27,372,866$498,26710.252,854T Rowe ProxyRBC0.34%
IVRA12/22/20Invesco Real Assets ESG ETF$3,053,953$045.29874Fidelity ProxyCitadel0.59%
Gabelli Love Our Planet & People ETF
GGRW2/16/21Gabelli Growth Innovators ETF$2,627,800$048.5189ActiveSharesGTS0.90%
GAST1/5/22Gabelli Asset ETF$4,806,900$036.6814ActiveSharesGTS0.00%
GABF5/11/22Gabelli Financial Services Opportunities ETF$6,330,150$414,97528.26282ActiveSharesGTS0.04%
Gabelli Commercial Aerospace & Defense ETF
FRTY3/1/21Alger Mid Cap 40 ETF$27,200,000-$4,655,75039.9510,268ActiveSharesVirtu0.60%
ATFV5/4/21Alger 35 ETF$10,594,375$37562.57595ActiveSharesVirtu0.55%
AWEG3/7/23Alger Weatherbie Enduring Growth ETF$4,076,000$2,826,62568.453,006ActiveSharesVirtu0.65%
CLIA5/9/23Veridien Climate Action ETF$2,735,475$2,512,15351.3311,175ActiveSharesGTS0.85%
REIT2/26/21ALPS Active REIT ETF$18,360,049$862,55035.163,235Blue TractorGTS0.68%
STNC3/16/21Hennessy Stance ESG Large Cap ETF$44,502,395$936,00231.282,328Blue TractorGTS0.85%
PFUT5/26/21Putnam Sustainable Future ETF$164,455,188$147,871,05529.669,881Fidelity ProxyVirtu0.64%
PLDR5/26/21Putnam Sustainable Leaders ETF$363,286,194$334,874,62910.48151,476Fidelity ProxyRBC0.59%
PGRO5/26/21Putnam Focused Large Cap Growth ETF$31,954,962$16,265,6469.289,148Fidelity ProxyRBC0.55%
PVAL5/26/21Putnam Focused Large Cap Value ETF$163,212,705$21,631,46228.2223,330Fidelity ProxyVirtu0.55%
HFGO11/9/21Hartford Large Cap Growth ETF$92,284,718-$688,09529.742,889Fidelity ProxyCitadel0.59%
SEMI3/30/22Columbia Seligman Semiconductor and Technology ETF$20,562,028$1,786,92528.542,160Fidelity ProxyVirtu0.75%
CAPE4/5/22DoubleLine Shiller CAPE U.S. Equities ETF$266,149,460$28,490,00014.5742,135ActiveSharesCitadel0.65%
FMCX4/25/22FMC Excelsior Focus Equity ETF$78,935,100-$289,40017.06282ActiveSharesGTS0.70%
BYRE5/19/22Principal Real Estate Active Opportunities ETF$5,398,318$436,84025.91474Fidelity ProxyVirtu0.65%

Source: Factset & NYSE Internal Database and Consolidated Tape Statistics as of 6/9/2023

*Simple average

Recent Active ETF Launches

TickerNameIssuerLaunch DateAsset ClassAUM
MAYTAllianzIM U.S. Large Cap Buffer10 May ETFAllianz Investment Management5/1/23Equity$39,757,655
MAYWAllianzIM U.S. Large Cap Buffer20 May ETFAllianz Investment Management5/1/23Equity$88,491,223
HEATTouchstone Climate Transition ETFTouchstone Investments5/2/23Equity$11,748,375
APCBActivePassive Core Bond ETFEnvestnet5/3/23Fixed Income$93,919,358
APMUActivePassive Intermediate Municipal Bond ETFEnvestnet5/3/23Fixed Income$28,916,750
APIEActivePassive International Equity ETFEnvestnet5/3/23Equity$68,722,500
APUEActivePassive U.S. Equity ETFEnvestnet5/3/23Equity$158,919,030
USEUSCF Energy Commodity Strategy Absolute Return FundUSCF5/4/23Alternatives$3,085,800
CLIAVeridien Climate Action ETFVeridien5/9/23Equity$2,701,275
IQRAIQ CBRE Real Assets ETFIndexIQ5/10/23Equity$4,906,720
CMDTPIMCO Commodity Strategy Active Exchange-Traded FundPIMCO5/10/23Commodities$6,798,605
TOLLTema Monopolies and Oligopolies ETFTema5/11/23Equity$3,515,624
BDGSBridges Capital Tactical ETFBridges5/11/23Equity$11,717,580
NVDYYieldMax NVDA Option Income Strategy ETFYieldMax5/11/23Equity$9,647,500
RSHOTema American Reshoring ETFTema5/11/23Equity$7,344,216
LUXTema Luxury ETFTema5/11/23Equity$5,327,608
BKIVBNY Mellon Innovators ETFBNY Mellon5/17/23Equity$10,844,907
BKWOBNY Mellon Women's Opportunities ETFBNY Mellon5/17/23Equity$10,270,386
ZTAXX-Square Municipal Income Tax Free ETFX-Square5/19/23Fixed Income$2,010,550
PEMXPutnam Emerging Markets ex-China ETFPutnam5/18/23Equity$6,360,795
ECMLEuclidean Fundamental Value ETFEuclidean5/18/23Equity$141,123,283
Roundhill Generative AI & Technology ETF
HYFIAB High Yield ETFAllianceBernstein5/15/23Fixed Income$67,182,980
EMMGlobal X Emerging Markets ETFGlobal X5/15/23Equity$27,258,539
EMCGlobal X Emerging Markets Great Consumer ETFGlobal X5/15/23Equity$366,082,263
GMAYFT Cboe Vest U.S. Equity Moderate Buffer ETF - MayFT Cboe Vest5/22/23Equity$118,026,431
SMAYFT Cboe Vest U.S. Small Cap Moderate Buffer ETF - MayFT Cboe Vest5/22/23Equity$12,330,041
BLCVBlackRock Large Cap Value ETFiShares5/23/23Equity$6,064,896
BINCBlackRock Flexible Income ETFiShares5/23/23Fixed Income$75,990,000
AIDBQRAFT AI-Pilot U.S. Large Cap Dynamic Beta and Income ETFETC5/24/23Equity$1,283,251
JUNTAllianzIM U.S. Large Cap Buffer10 Jun ETFAllianz Investment Management6/1/23Equity$21,717,840
JUNWAllianzIM U.S. Large Cap Buffer20 Jun ETFAllianz Investment Management6/1/23Equity$53,983,925
INCMFranklin Income Focus ETFFranklin Templeton6/8/23Asset Allocation$100,171,200
RUNNRunning Oak Efficient Growth ETFRunning Oak6/8/23Equity$2,035,668
RMIFLHA Risk-Managed Income ETFLittle Harbor Advisors6/9/23Fixed Income$625,123
Total - 35 New ETFs

Source: Factset as of 6/9/2023

Fixed income securities are subject to interest rate, inflation, credit and default risk. The bond market is volatile. As interest rates rise, bond prices usually fall, and vice versa. The return of principal is not guaranteed, and prices may decline if an issuer fails to make timely payments or its credit strength weakens.

Collateralized Loan Obligations (CLOs) are debt securities issued in different tranches, with varying degrees of risk, and backed by an underlying portfolio consisting primarily of below investment grade corporate loans. The return of principal is not guaranteed, and prices may decline if payments are not made timely or credit strength weakens. CLOs are subject to liquidity risk, interest rate risk, credit risk, call risk and the risk of default of the underlying assets.

OBJECTIVE: Janus Henderson AAA CLO ETF (JAAA) seeks capital preservation and current income by seeking to deliver floating-rate exposure to high quality AAA-rated collateralized loan obligations (“CLOs”).

Actively managed portfolios may fail to produce the intended results. No investment strategy can ensure a profit or eliminate the risk of loss.

Duration measures a bond price’s sensitivity to changes in interest rates. The longer a bond’s duration, the higher its sensitivity to changes in interest rates and vice versa.

An inverted yield curve occurs when short-term yields are higher than long-term yields.

Quantitative Tightening (QT) is a government monetary policy occasionally used to decrease the money supply by either selling government securities or letting them mature and removing them from its cash balances.

Tranches are segments of a pool of securities that are divided up by credit rating, maturity, or other characteristics.

Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus Henderson at 800.668.0434 or download the file from Read it carefully before you invest or send money.

Past performance is no guarantee of future results. Call 800.668.0434 or visit for current month-end performance.

Janus Henderson Distributors US LLC Janus Henderson Investors US LLC is the investment adviser and ALPS Distributors, Inc. is the distributor. ALPS is not affiliated with Janus Henderson or any of its subsidiaries.

Janus Henderson is a trademark of Janus Henderson Group plc or one of its subsidiaries. © Janus Henderson Group plc.


C-0623-50092 10-15-2023

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