The new UCITS compliant fund will employ a liquid equity long/short strategy in an effort to target “positive absolute returns regardless of market movements,” the asset manager said. It will typically hold between 40-60 long and 40-60 short positions and make use of equity swaps, ETFs and index futures.
Oisin Crawley, co-head of research for the Asian Equities team, and BlackRock Asian Equities head Andrew Swan will be at the helm of the new fund, supported by a team of 21 based in Hong Kong and Taiwan.
BlackRock is adamant that investors should not let their anxieties around China’s slowing growth, the strength of the US dollar and commodity price fluctuations prevent them from taking advantage of investment opportunities in the region.
“The Asia Pacific region has undergone profound structural reform and economic transition and the investment universe spans 14 markets, numerous currencies and more than 2,000 companies, covered by fewer analysts than in the US or Europe,” the firm said in a statement. “The BSF Asia Pacific Absolute Return Fund will look to exploit the under-appreciated areas of strength, while benefitting on the short side from internal and external pressures on companies.”
And amid the current uncertain, volatile climate where valuations for equities and fixed income instruments are appearing even more skewed. According to Alex Hoctor-Duncan, head of EMEA retail at BlackRock, investors are looking for steady sources of positive absolute return.
“The BSF Asia Pacific Absolute Return Fund is for investors who are keen to explore what the region has to offer and want to diversify their portfolio, without taking on excessive market risk,” he said.