MV Index Solutions GmbH (MVIS®) recently launched the ATAC Credit-On/Credit-Off Index (JOJO), an index designed to rotate in its exposure between long-term U.S. treasuries and high-yield corporate bonds using U.S.-listed ETFs.
The specific composition of JOJO will be determined by a proprietary signal which indicates a “Credit On” or “Credit Off” position and that considers the relative price of large cap U.S. equities and U.S. utilities equities. The index covers ETFs that represent long-term U.S. treasuries and high-yield corporate bonds. The index may be 100% long long-term U.S. treasuries or high-yield corporate bonds ETFs at rebalance.
“We are pleased to utilize our sophisticated index construction capabilities to develop and launch the ATAC Credit-On/Credit-Off Index,” said Steven Schoenfeld, CEO of MV Index Solutions. “This is the second unique index we’ve developed in partnership with Toroso, and we anticipate substantial interest in their products – both JOJO and RORO – benchmarked to these indexes,” he continued.
Toroso Asset Management, the New York-based investment management company specializing in ETF-focused research, investment strategies, and services, was closely involved in developing the index and will use it to launch a new product designed for financial advisors, RIAs, family offices, and investment managers.
“The world needs a solution to the fixed income problem where the bond market is substantially broken,” says Michael A. Gayed, CFA, Portfolio Manager at Toroso Investments, LLC. “The ATAC Credit Rotation Index is as tactical as it gets while providing yield and price appreciation potential by seeking to position defensively in treasuries prior to credit spread widening events,” says Gayed.
JOJO is calculated in USD as a price and a total return gross index. The index is reviewed on a weekly basis two hours before the close of the NYSE on Fridays and will be rebalanced based on the signal and security weights.