As the name suggests, a multi-asset strategy combines different types of assets, such as stocks, bonds, real estate or cash, to create a more nimble and broadly diversified portfolio. Fund managers make big-picture decisions to achieve particular investment objectives, such as seeking growth, seeking income, or minimizing risk.
There are many different multi-asset strategies, but the three major multi-asset fund categories include:
- Global Macro Allocation: These multi-asset funds offer investors broad diversification across a wide spectrum of asset classes. These funds have the flexibility to adapt to ever-changing macro-economic conditions.
- Risk Tolerance: These funds tailor their allocation toward a desired level of risk, whether it is conservative, moderate or aggressive.
- Target Date: Typically geared toward retirement investing, these multi-asset funds are designed to gradually change the portfolio's allocation to match a specific investment horizon.
Multi-asset strategies offer
many benefits
High-level allocation strategy is a critical component to investment success. The common element across multi-asset funds is that experienced fund managers make key decisions, such as whether to invest more assets overseas, shift assets from bonds to other income-generating securities, dial back risk or be more opportunistic, for you.
Outcome-oriented strategies
BlackRock offers a wide range of multi-asset strategies to help you achieve your investment goals, whether you want to dynamically invest across the globe, keep risk exposure to a minimum or take the guess work out of asset allocation decisions. Whatever your goals, you can look to BlackRock to help manage them based on:
- EXPERIENCE: More than 26 years’ average experience1 building multi-asset portfolios across a range of funds, customized mandates, and model portfolios.
- BREADTH: Scale, industry leading risk management capabilities – Aladdin® and global reach of BlackRock.
- DEPTH: $434 billion2 managed by over 200 investment professionals across 9 teams.
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Data in the following tables is valid as of 9/30/18
For fund performance and standardized rating periods, click on the fund name.
Data in the following tables is valid as of 9/30/18
| Growth | ||
|---|---|---|
| iShares Core Aggressive Allocation ETF | AOA | 0.33% |
| iShares Core Conservative Allocation ETF | AOK | 0.34% |
| iShares Core Moderate Allocation ETF | AOM | 0.34% |
| iShares Core Growth Allocation ETF | AOR | 0.33% |
| Income | ||
| iShares Morningstar Multi-Asset Income ETF | IYLD | 0.60% |
For standardized performance and more information, click on the ETF name.
| Allocation |
|---|
| Target Allocation ETF Portfolio Strategies |
| Research Models |
| BlackRock Model Portfolios |
More about multi-asset strategies
How do BlackRock's multi-asset strategies compare to others?
Whether you're looking to better manage portfolio risk, plan for a specific investment horizon or tap into broader opportunities, BlackRock multi-asset mutual funds and iShares ETFs can help you achieve your goals and minimize your investment expenses.
Our multi-asset investing team has expertise in key markets around the world and across asset classes. The common thread: All our funds are anchored by our depth of research and unwavering commitment to our investors. And as the world's largest asset manager, we use our scale to deliver a depth of research and expertise with below-average investment fees.
What are some risks associated with multi-asset strategies?
The major benefit of multi-asset securities is having professional investors guide big-picture investment decisions. This helps mitigate risk, but, as with any investment, does not completely eliminate it.
One potential risk is choosing a fund with objectives that don't align with yours. For example, you may think you want to invest aggressively, when a more conservative approach might be more suitable. On the other hand, taking too conservative an approach can make it more difficult to achieve your long-term goals.
Likewise, because many multi-asset strategies, such as target-date or target-risk funds, are designed to encompass a large percentage of your assets, you should pay attention to your management team's track record and investment fees.
What are some myths associated with multi-asset strategies?
Most of the myths associated with multi-asset strategies stem from a mistaken or limited definition. Some investors think multi-asset strategies are simply macro-economic funds. Others only associate them with target date funds. The reality: Multi-asset strategies, as outlined above, can be either of these things — and more.
Important considerations
Multi-asset funds can be a powerful tool for achieving your investment objectives, but a strategy that works well for one investor may not be the best fit for another. As with any investment decision, it's important to first understand what you're trying to achieve and then identify the best strategy to get you there.
Past performance is no guarantee of future results
1 Average experience of Multi-Asset Strategies Group senior investment leaders as of 9/30/18.
2 Additional assets are managed in collaboration with Multi-Asset Strategies leaders as part of Smart Beta ($146 bn) and Private Investors ($87 bn) platforms, which are not included in the total MAS AUM $434 bn. These assets are shown in gross view which represents aggregate AUM. All data of 9/30/18.
† As of 9/30/18. Source: Morningstar. Analysis based only on institutional shares of BlackRock active multi-asset funds vs. institutional shares of active multi-asset funds within their respective Morningstar categories. Expenses are based on the funds’ most recent prospectus net expense ratios, excluding investment dividend expense, interest expense, and certain other fund expenses. Morningstar category net expense ratio also excludes these expenses. Includes active open-end multi-asset mutual funds only, and excludes index funds. Institutional shares may not be available to all retail investors. Performance for different share classes may vary.
Investing involves risk, including possible loss of principal.
Important Risks of the Funds: The mutual funds are actively managed and characteristics will vary. Bond values fluctuate in price so the value of your investment can go down depending on market conditions. The two main risks related to fixed income investing are interest-rate and credit risk. Typically, when interest rates rise, there is a corresponding decline in the market value of bonds. Credit risk refers to the possibility that the bond issuer will not be able to make principal and interest payments. The principal on mortgage- or asset-backed securities normally may be prepaid at any time, which reduces the yield and market value of those securities. Obligations of US gov’t agencies and authorities are supported by varying degrees of credit but generally are not backed by the full faith and credit of the US gov’t. Investing in derivatives entails specific risks relating to liquidity, leverage and credit that may reduce returns and increase volatility. International investing includes risks related to foreign currency, limited liquidity, less government regulation and the possibility of substantial volatility due to adverse political, economic or other developments. These risks often are heightened for investments in emerging/developing markets or smaller capital markets. Investments in non-investment-grade debt securities (”high-yield” or ”junk” bonds) may be subject to greater market fluctuations and risk of default or loss of income and principal than securities in higher rating categories. There may be less information on the financial condition of municipal issuers than for public corporations. The market for municipal bonds may be less liquid than for taxable bonds. Some investors may be subject to Alternative Minimum Tax (AMT). Capital gains distributions, if any, are taxable.
The principal value of the fund(s) is not guaranteed at any time, including at the target date. The target date in the name of the fund is the approximate date when an investor plans to start withdrawing money.
The iShares ETFs are not actively managed and will not attempt to take defensive positions under any market conditions, including declining markets. Investment in a fund of funds is subject to the risks and expenses of the underlying funds.
BlackRock's role is limited to providing you or your firm (collectively, the "Advisor") with non-discretionary investment recommendations in the form of model portfolios in connection with its management of its clients' accounts. The implementation of, or reliance on, a Managed Portfolio Strategy is left to the discretion of the Advisor. BlackRock is not responsible for determining the suitability or appropriateness of a Managed Portfolio Strategy or any securities included therein for any of the Advisor's clients. BlackRock does not place trade orders for any of the Advisor's clients' account. Information and other marketing materials provided to you by BlackRock concerning a Managed Portfolio Strategy - including holdings, performance and other characteristics - may not be indicative of a client's actual experience from an account managed in accordance with the strategy.
Carefully consider the Funds' investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the Funds' prospectuses or, if available, the summary prospectuses which may be obtained visiting the iShares ETF and BlackRock Mutual Fund prospectus pages. Read the prospectus carefully before investing.
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