FOR PROFESSIONAL INTERMEDIARIES ONLY, NOT FOR PUBLIC DISTRIBUTION
(PLEASE READ IMPORTANT DISCLOSURE)
Implementing BlackRock’s key
investment ideas in 2015
Today’s investment landscape is complex enough but, with more challenges
ahead in 2015, we wanted to give you some insight into our views and how they
could be implemented in your clients’ portfolios. For now:
 We favour equities over bonds, but it’s becoming increasingly challenging
finding value in a fully-valued world.
 In equities, we like Japan, some Asian markets and some sectors in Europe.
 In fixed income, wildly different monetary policy environments demand great
flexibility.
 Income in general is difficult to find.
 Be diversified, but be warned, achieving diversification is getting tougher.
This backdrop raises a number of key questions, so we’ve selected some of the
best ways we have of answering them:
Where can I find a higher income?
Finding attractive levels of income has never been more challenging, with more
people chasing fewer assets and interest rates lingering near historic lows. Low
bond yields could force some income seekers further up the risk spectrum than
they want to go.
So what can they do?
Use multi-asset to provide a consistent, attractive income and real diversification.
Look to dividend-payers for their higher yields.
Product
Category
BGF Global Multi-Asset Income Fund
Multi-Asset
BGF European Equity Income Fund
Dividend-payers
BGF Global Equity Income Fund
Dividend-payers
How should I position my bond portfolios?
Many investors habitually look to bonds for steady capital growth and the
income they need. We expect central bank policies to diverge even further in
2015, with yields in Europe and Japan remaining low with others, such as the
United States, likely to see interest rate rises.
So what can they do?
Reduce their exposure to traditional bonds. Look for opportunities in emerging
markets where yields tend to be structurally higher. Unconstrained strategies,
with their ability to invest in many different kinds of bonds, can help ride out
some of the volatility we expect to see next year.
Product
Category
BGF Asian Tiger Bond Fund
Emerging market bonds
BGF Renminbi Bond Fund
Emerging market bonds
BGF Fixed Income Global Opportunities Fund
Unconstrained fixed income
Tan Kueh,
Head of Private Bank Sales
Where do I need to go for growth?
Valuations in many developed markets look stretched, and trades are getting
crowded. Unlocking capital growth potential won’t be easy. We like some Asian
markets, where valuations are attractive and we see real opportunity for
earnings growth in a world in which it’s increasingly rare. Some sectors also
appeal.
So what can they do?
Look to Asian equities to benefit from the reforms sweeping the region.
Healthcare related equities can add diversification and benefit from long term
growth potential.
Product
Category
BGF Asian Dragon Fund
Asian Equities
BGF Asian Growth Leaders Fund
Unconstrained Asian Equities
BGF World Healthsciences Fund
Healthcare Equities
How do I manage the volatility?
There are very few certainties in 2015, but one thing you can rely on is more
upheaval as policy divergences. Correlations have increased, and volatility is
back. Mistakes will be costly so diversification could be crucial.
So what can they do?
Access liquid alternatives to help achieve portfolio diversification and
outmanoeuvre volatility.
Product
Category
BSF Global Long Short Equity Fund
Long/Short
BSF Emerging Markets Allocation Fund
Multi-Asset
BlackRock Healthsciences Hedge Fund
Long/Short
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