DoubleLine Securitized Credit ETF (DSCO)

Overview

DSCO is a financial entity focused on generating high current income through investments in USD-denominated securitized credit instruments. These instruments are backed by a variety of assets, such as mortgages, loans, receivables, or other similar debt obligations. The fund employs both direct investments and derivatives or synthetic instruments to manage its portfolio, allowing for a broad allocation across varied types of securitized credit. Importantly, DSCO remains flexible, capable of engaging with assets of any credit quality or duration.

The investment strategy of DSCO permits it to allocate up to 50% of its portfolio in high-yield bonds. Particular emphasis is placed on mortgage-backed securities, which are selected based on several factors: yield, duration, collateral quality, the reputation of sponsors, market supply and demand, and risk correlation. Additionally, the fund evaluates asset-backed securities to cater to a spectrum of risk and return profiles, while collateralized loan obligations (CLOs) are pursued for their yield, diversification benefits, and quality attributes.

Following a controlled risk approach, DSCO actively adjusts its strategies and investment duration in accordance with shifts in market conditions and economic environments. The fund maintains the flexibility to invest in cash, use hedging instruments, and engage in short sales to further refine its risk management tactics. Before its transition on February 2, 2026, DSCO was known as the DoubleLine Securitized Credit Fund and commenced operations with an asset base of $154 million.

Products and Services

• Securitized Credit Instruments
  

  Investments in USD-denominated securities backed by assets such as mortgages, loans, and receivables. These instruments form the core of DSCO’s investment strategy aimed at achieving consistent high current income.

• High-Yield Bonds
  

  Allocation of up to 50% of the fund in high-yield bonds, which provide greater return potential but also entail a higher risk profile. These bonds are selected based on their yield and credit quality.

• Mortgage-Backed Securities (MBS)
  

  MBS are chosen based on several criteria, including yield, collateral quality, risk correlation, and the credibility of the sponsors. This ensures a balanced approach to risk and return.

• Asset-Backed Securities (ABS)
  

  Investment in ABS to achieve diversified risk/return profiles. These securities are evaluated to fit within the broader investment strategy, providing opportunities for risk mitigation and yield enhancement.

• Collateralized Loan Obligations (CLOs)
  

  Engagement with CLOs allows DSCO to benefit from yield potential, enhance diversification, and select for quality, aligning with the fund's strategic directives.

• Active Portfolio Management
  

  DSCO employs a controlled risk approach, actively managing and adjusting investments in response to dynamic market conditions and economic indicators, ensuring adaptability and responsiveness.

• Cash and Hedging Instruments
  

  The fund retains the capacity to invest in cash and utilize hedging strategies to protect against market fluctuations, as well as incorporate short selling as a component of its investment methodology.