BlackRock's Natural Resources equity team H2 2022 outlook
Our latest outlook covers the teams expectations around commodity demand and supply for H2 2022 and beyond as well as current valuations and key risks to look out for.
This section includes investor type descriptions for professional clients and market counterparties.
Professional client
A Professional Client is either: (i) a ‘deemed’ professional client; (ii) serviced-based professional client; or (iii) an assessed professional Client
(i) Deemed Professional Client
A person is a “deemed” professional client if the person is:
(ii) Service-based Professional Clients
A person is a ‘serviced-based’ professional client if
(iii) Assessed-based Professional Clients
Assessed-based professional clients can be either (i) individuals; or (ii) undertakings
Individuals
An individual (and associated joint account holders) would be classified as an ‘assessed-based professional client’ if:
Where there is a joint account in place, the secondary account holder must obtain confirmation in writing that investment decisions relating to the joint account are made for or on behalf of the secondary account holder
Undertakings
Undertakings, which are generally not individuals, would be classified as ‘assessed-based’ professional clients if it:
Market counterparties
A Market Counterparty is any person who is either:
We recognise natural resources companies need to be part of the low carbon transition, from reducing their own emissions to supplying materials required to build wind turbines and solar panels.
The chart below looks at copper as an example, highlighting the expected growth in demand from electric vehicles, wind and solar between now and 2030.
Expected growth in copper demand from electric vehicles (EVs), wind and solar
Source: Woodmac, CRU, Goldman Sachs Global Investment Research, 31 Oct 2021
Our belief is that companies with stronger and / or improving ESG credentials offer better risk-adjusted returns over the long-run.
We consider ESG alongside valuation and fundamentals when constructing portfolios to maximise risk-adjusted returns.
We are not precluded from holding companies that have had ESG issues in the past as, if we believe it’s moving in the right direction, that may form part of our investment rationale.
We take forward-looking views on each company’s ESG profile and document these in our research templates.
Views are formed through activities such as: engaging with management teams, site visits and collaboration with the BlackRock Investment Stewardship team.
Risk: This information should not be relied upon as research, investment advice, or a recommendation regarding any products, strategies, or any security in particular. This is for illustrative and informational purposes and is subject to change. It has not been approved by any regulatory authority or securities regulator. The environmental, social, and governance (“ESG”) considerations discussed herein may affect an investment team’s decision to invest in certain companies or industries from time to time. Results may differ from portfolios that do not apply similar ESG considerations to their investment process.
Our latest outlook covers the teams expectations around commodity demand and supply for H2 2022 and beyond as well as current valuations and key risks to look out for.