What’s really moving credit markets in 2026? In this episode, Mark Jarosz joins host Acushla Vestby to cut through the headlines — breaking down where the opportunities lie, what risks to watch, and how credit alternatives fit into today’s portfolios.

Acushla Vestby is Head of Structured Solutions and National Accounts at BMO Global Asset Management (BMO GAM). She is joined by Mark Jarosz, Head of Credit Alternatives at BMO GAM. This episode was recorded live on March 27, 2026.

ETFs mentioned:

BMO AAA CLO ETF (Ticker: ZAAA)⁠

BMO BBB CLO ETF (Ticker: ZBBZ)⁠

Source: ETF Flows, according to the National Bank Report, February 2026

Collateralized Debt Obligation (CDO): A structured financial product where a bank or other entity pools together various types of debt, like mortgages, bonds, and loans, and repackages them into tranches, or classes of securities, based on their risk level.

Collateralized Loan Obligation (CLO): A structured financial product where a manager pools together corporate loans and repackages them into tranches, or classes of securities, based on their risk level.

Loan-to-Value (LTV): A financial ratio calculated by dividing a loan’s size by an asset’s appraised value. A higher LTV signifies greater risk of default.

Liquidity: The degree to which an asset or security can be quickly bought or sold in the market without affecting the asset’s price. Cash is considered to be the most liquid asset, while things like fine art or rare books would be relatively illiquid.

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CLOs are floating- or fixed-rate debt securities issued in different tranches, with varying degrees of risk, by trusts or other special purpose vehicles (“CLO Issuers”) and backed by an underlying portfolio consisting primarily of below investment-grade corporate loans. The BMO AAA CLO ETF pursues its investment objective by investing, under normal circumstances, at least 85% of its net assets in CLOs that, at the time of purchase, are rated AAA or the equivalent by a nationally recognized statistical rating organization. The BMO BBB CLO ETF pursues its investment objective by investing, under normal circumstances, at least 75% of its net assets in CLOs that are BBB-rated at the time of purchase.

AAA herein refers to the order of payments, should there be any defaults, and does not represent the ratings of the underlying loans within the CLO. If there are loan defaults or the CLO Issuer’s collateral otherwise underperforms, scheduled payments to senior tranches take precedence over those of mezzanine tranches (a tranche or tranches subordinated to the senior tranche; e.g., AAA tranches are the most senior, while BBB tranches are mezzanine-level), and scheduled payments to mezzanine tranches take precedence over those to subordinated/equity tranches. The riskiest portion is the “Equity” tranche, which bears the first losses and is expected to bear all or the bulk of defaults from the corporate loans held by the CLO Issuer serves to protect the other, more senior tranches from default.

CLOs are floating- or fixed-rate debt securities issued in different tranches, with varying degrees of risk, by trusts or other special purpose vehicles (“CLO Issuers”) and backed by an underlying portfolio consisting primarily of below investment-grade corporate loans. The BMO ETF pursues its investment objective by investing, under normal circumstances, at least 75% of its net assets in BBB CLOs that, at the time of purchase, are rated BBB or the equivalent by a nationally recognized statistical rating organization.

BBB herein refers to the order of payments, should there be any defaults, and does not represent the ratings of the underlying loans within the CLO. If there are loan defaults or the CLO Issuer’s collateral otherwise underperforms, scheduled payments to senior tranches take precedence over those of mezzanine tranches (a tranche or tranches subordinated to the senior tranche), and scheduled payments to mezzanine tranches take precedence over those to subordinated/equity tranches. BBB is a mezzanine tranche. The riskiest portion is the “Equity” tranche, which bears the first losses and is expected to bear all or the bulk of defaults from the corporate loans held by the CLO Issuer serves to protect the other, more senior tranches from default.

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Podcast: Cutting Through the Credit Noise