Asian Fixed Income Investment Center
INVESTMENT IDEAS

Asian Fixed Income Investment Center

Your go-to resource center for the latest market insights and information on BlackRock’s range of Asian fixed income solutions.
  • Important

    1. The China Bond Fund seeks to maximise total return. The Fund invests at least 70% of its total assets in fixed income transferable securities denominated in Renminbi or other non-Chinese domestic currencies issued by entities exercising the predominant part

    1. The China Bond Fund seeks to maximise total return. The Fund invests at least 70% of its total assets in fixed income transferable securities denominated in Renminbi or other non-Chinese domestic currencies issued by entities exercising the predominant part of their economic activity in the PRC through recognised mechanisms including but not limited to the Chinese Interbank Bond Market, the on exchange bond market, quota system and/or through onshore or offshore issuances and/or any future developed channels. The Fund is a RQFII Access Fund and a CIBM Fund and may invest without limit in the PRC via RQFII Quota and in the CIBM via the Foreign Access Regime and/or Bond Connect and/or other means as may be permitted by the relevant regulations from time to time.
    2. The Asian Tiger Bond Fund seeks to maximise total return. The Fund invests at least 70% of its total assets in the fixed income transferable securities of issuers domiciled in, or exercising the predominant part of their economic activity in, Asian Tiger countries. The Fund may invest in the full spectrum of available securities, including non-investment grade. The currency exposure of the Fund is flexibly managed.
    3. The Asian High Yield Bond Fund seeks to maximise total return. The Fund invests at least 70% of its total assets in high yield fixed income transferable securities, denominated in various currencies, issued by governments and agencies of, and companies domiciled in, or exercising the predominant part of their economic activity in the Asia Pacific region. The Fund may invest in the full spectrum of permitted fixed income transferable securities and fixed income related securities, including non-investment grade. Currency exposure is flexibly managed.
    4. The China Bond Fund may invest in debt securities that are subject to actual or perceived ratings downgrade. An increase in interest rates may adversely affect the value of the bonds held by the Fund. The Fund may invest in non-investment grade and unrated bonds that may be subject to higher default, volatility and liquidity risks. The Fund invests in bonds issued or guaranteed by governments or authorities, which may involve political, economic, default or other risks. The Fund may invest in urban investment bonds issued by Chinese local government financing vehicles (“LGFVs”) that are subject to default risk of the LGFVs.
    5. The China Bond Fund is subject to restrictions and requirements applicable to the Renminbi Qualified Foreign Institutional Investor (“RQFII”) investments, which may adversely affect the fund’s value due to regulatory uncertainties. The Fund is subject to risks associated with investment in the China Interbank Bond Market.
    6. The China Bond Fund's investments are concentrated in People’s Republic of China (PRC). This may result in greater volatility than more broad-based investments. The Fund invests in certain emerging markets and may be subject to political, tax, economic, social and foreign exchange risks.
    7. The China Bond Fund is subject to PRC tax risks, currency risks, securities lending counterparty risks, foreign investments restrictions risks, currency control/ conversion risks and currency hedging risk.
    8. The Asian Tiger Bond Fund may invest in debt securities that are subject to actual or perceived ratings downgrade. The Fund invests in certain emerging markets and may be subject to political, tax, economic, social and foreign exchange risks. An increase in interest rates may adversely affect the value of the bonds held by the Fund. The Fund may invest in non-investment grade and unrated bonds that may be subject to higher default, volatility and liquidity risks. The Fund invests in bonds issued or guaranteed by governments or authorities, which may involve political, economic, default or other risks.
    9. The Asian Tiger Bond Fund is subject to currency risk, foreign investments restrictions risk, geographical concentration risk in Asian Tiger countries, liquidity risk, securities lending counterparty risk, currency conversion risk including Renminbi denominated Classes and contingent convertible bonds risk.
    10. The Asian High Yield Fund may invest in debt securities that are subject to actual or perceived ratings downgrade. An increase in interest rates may adversely affect the value of the bonds held by the Fund. The Fund may invest in non-investment grade and unrated bonds that may be subject to higher default, volatility and liquidity risks. The Fund invests in bonds issued or guaranteed by governments or authorities, which may involve political, economic, default or other risks.
    11. The Asian High Yield Fund is subject to currency risk, geographical concentration risk in Asia, emerging market risk, securities lending counterparty risk, currency conversion risk including Renminbi denominated Classes, foreign investments restrictions risk and contingent convertible bonds risk.
    12. Class 6 Sharespay dividends gross of expenses and/or from capital at the Directors’ discretion. Class 8 Shares pay dividends gross of expenses and/or from capital at the Directors’ discretion and include interest rate differentials arising from share class currency hedging. Negative interest rate differentials may decrease the dividends paid. Paying dividends gross of expenses may result in more income being available for distribution; however these shares may effectively pay dividends from capital – may amount to a partial return or withdrawal of an investor’s original investment or capital gains. All declared dividends result in an immediate reduction in the NAV price of the share class on the ex-dividend date.
    13. The Funds may use derivatives for hedging and for investment purposes. However, usage for investment purposes will not be extensive. The Fund may suffer losses from its derivatives usage.
    14. The value of the Funds can be volatile and can go down substantially within a short period of time. It is possible that a certain amount of your investment could be lost.
    15. Investors should not make investment decisions based on this document alone. Investors should refer to the Prospectus and Key Facts Statement for details including risk factors.
Asian fixed income Blog

Why invest in Asian Fixed Income?

Asian Fixed Income 2022 Midyear Outlook

Venn Saltirov, Portfolio Manager and ESG Investment Lead for Asia Credit, BlackRock

We believe it’s important for income investors to have a quality bias without taking on excessive duration risk.

Central banks today are faced with the difficult task of tamping down runaway inflation while minimizing the economic impact of raising rates. 

Overall, we think Asia credit sits at a sweet spot.

It offers average investment grade credit exposure, attractive yields and a shorter duration versus global investment grade credit.

In addition, Asian credit benefits from the strong presence of sovereign and quasi-sovereign issuers in the market with resilient fundamentals against any potential economic slowdown.

Asian fixed income strategies with an ESG overlay have proven to be more defensive in recent market volatility.

We have a strong conviction on the influence of ESG factors in Asian Credit and believe that investing through an ESG lens adds a positive layer to the investment process.

What is your outlook on China for the rest of 2022

Yii Hui Wong, Portfolio Manager, China Fixed Income, BlackRock

As China gradually opens up from lockdowns, we expect investor sentiment to turn more positive in the second half. 

China credit remains our top pick, especially onshore CNY credit.

It serves as an effective diversifier in a global portfolio and has benefited from the country’s stable inflation levels and supportive policies.

Given low inflation in China, ambitious growth targets and supportive statements made by multiple top authorities, we think monetary policy will remain accommodative.

Investors benefits from 2 layers of diversification when investing in China bonds.

Firstly, CNY credit has seen positive performance and outperformed other key global asset classes across recent periods of major global market shocks. It has proven to be a powerful tool to build resilience in a global portfolio.

Secondly, the low correlation between onshore CNY and offshore China USD credit market allows us to reduce portfolio volatilities and generate alpha through dynamic asset allocation.

China continues to offer attractive yields at low duration.

Our ability to dynamically invest across onshore and offshore credits allow us to capture dislocation opportunities to maximize yields without introducing extra credit risks.

Relative attractive yields

Asian credit continue to provide higher yields than global counterparts1

Relatively stable macro-economic fundamentals in Asia

Default rates continue to be low outside of the offshore China space2; macroeconomic fundamentals remain encouragingly resilient

A united focus on growth in China

Ambitious targets and supportive statements from top authorities suggest support for China fixed income in both monetary and fiscal terms

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BlackRock China Bond Fund

Target to capture yield and growth opportunities in the development of China bond market

5.5 p.a. (A6 RMB as of 30 June 2022)
A6 share class aims to pay a dividend on a monthly basis. Dividend Payment is not guaranteed and is not indicative of the return of the Fund. The Fund may effectively pay dividend from capital. See important information 12 3
5.5% p.a. (A6 RMB as of 29 January 2021)
Offers diversification and resilience to your portfolio
Offers diversification and resilience to your portfolio
China bonds have lower correlation to other risk assets4, which can help provide significant diversification with existing fixed income exposure
A “go-anywhere” strategy with cross-border RMB bond offering
A “go-anywhere” strategy with cross-border RMB bond offering
Have the flexibility to invest across China and offshore RMB and USD China credit market to capture the better income and growth opportunities

BlackRock Asian Tiger Bond Fund

Enjoy Asian credit's competitive yields and appreciate the potential of the region’s improving macroeconomic and corporate fundamentals

5.4% p.a. (A6 USD as of 30 June 2022)
A6 share class aims to pay a dividend on a monthly basis. Dividend Payment is not guaranteed and is not indicative of the return of the Fund. The Fund may effectively pay dividend from capital. See important information 12 5
5.1% p.a. (A6 USD as of 30 September 2021)
A core “credit+plus” Asian credit strategy
A core “credit+plus” Asian credit strategy
Credit focus complemented by opportunistic rates and currency allocation
Finding opportunities across APAC
Finding opportunities across APAC
Has the flexibility to invest in fixed income across the Asian region in the search for stable income
Robust platform and experienced team
Robust platform and experienced team
An integrated Asian fixed income team with expertise across currency, rating and liquidity spectrums

BlackRock Asian High Yield Fund

A high income strategy combined with an opportunistic approach for growth

9.9% p.a. (A6 USD as of 30 June 2022)
A6 share class aims to pay a dividend on a monthly basis. Dividend Payment is not guaranteed and is not indicative of the return of the Fund. The Fund may effectively pay dividend from capital. See important information 12 6
9.1% p.a. (A6 USD as of 30 September 2021)
High income potential
High income potential
Core allocation to credits with high current income while investing opportunistically to capture capital upside
High conviction approach
High conviction approach
Active high conviction approach to maximizing returns while managing the downside
Robust platform and experienced team
Robust platform and experienced team
Leveraging the insights from an integrated Asia fixed income platform with expertise across traditional and alternative strategies with proven track record

Related Insights

China Bond Market 2022 Midyear Outlook

Yii Hui Wong, Portfolio Manager, China Fixed Income, BlackRock

As China gradually opens up from lockdowns, we expect investor sentiment to turn more positive in the second half. 

China credit remains our top pick, especially onshore CNY credit.

It serves as an effective diversifier in a global portfolio and has benefited from the country’s stable inflation levels and supportive policies.

Given low inflation in China, ambitious growth targets and supportive statements made by multiple top authorities, we think monetary policy will remain accommodative.

Investors benefits from 2 layers of diversification when investing in China bonds.

Firstly, CNY credit has seen positive performance and outperformed other key global asset classes across recent periods of major global market shocks. It has proven to be a powerful tool to build resilience in a global portfolio.

Secondly, the low correlation between onshore CNY and offshore China USD credit market allows us to reduce portfolio volatilities and generate alpha through dynamic asset allocation.

China continues to offer attractive yields at low duration.

Our ability to dynamically invest across onshore and offshore credits allow us to capture dislocation opportunities to maximize yields without introducing extra credit risks.

2022 China bond market midyear outlook

China bond continues to offer attractive yields at low duration. It serves as an effective diversifier in a global portfolio and has benefited from the country’s stable inflation levels and supportive policies.

Why BlackRock for Asian Fixed Income

Breadth of solutions
Breadth of solutions
Our range of Asian Fixed Income solutions can help to deliver income at different risk tolerance levels. Look to BlackRock to find the solution that is right for you.
Flexible implementation
Flexible implementation
We seek to deliver income in various forms — using a mix of our Asian Fixed Income funds or as complement to a global credit portfolio — to meet your diverse needs.
Team expertise
Team expertise
An integrated Asian fixed income team with expertise across traditional and alternative strategies, supported by our strong platform, technology and market access.