Young Choi, Portfolio Manager for the XAI Floating Rate & Alternative Income Trust, says there is more value and broad movement in the secondary markets for equity collateralized loan obligations, whereas opportunities in debt CLOs have been more specific and sporadic. Choi, the global head of trading at King Street and a portfolio manager for Rockford Tower, which took over as advisor for the XAI fund, discusses how the CLO market has been changed by the emergence of CLO ETFs, noting that they debuted in 2021 and needed nearly a year to achieve $1 billion in assets, but now are seeing roughly $2 billion in in-flows every month, adding a “significant new and growing buyer” into the marketplace and compressing spreads. Choi also discusses differences in the private credit and CLO markets, noting that any blow-up or problem in the private space could have spillover effects that create buying opportunities in CLOs.