About BlackRock
ISHARES ETFS
Institutional Investors
SUSTAINABLE INVESTING
RESEARCH & INSIGHTS
Latest Insights
By accepting the following Terms and Conditions, you represent and warrant that you are a resident of Singapore and an institutional or accredited investor as defined in Section 4A of the Securities and Futures Act, Chapter 289 of Singapore.
READ THESE TERMS AND CONDITIONS ("TERMS") CAREFULLY BEFORE USING THE SERVICES DESCRIBED HEREIN. BY UTILIZING THE WEBSITE LOCATED AT www.blackrock.com/sg ("WEBSITE"), YOU ACKNOWLEDGE THAT YOU HAVE READ THESE TERMS AND THAT YOU AGREE TO BE BOUND BY THEM. IF YOU DO NOT AGREE TO ALL OF THESE TERMS OF THIS AGREEMENT, YOU ARE NOT AN AUTHORIZED USER OF THESE SERVICES AND YOU SHOULD NOT USE THIS WEBSITE.
THIS WEBSITE IS NOT INTENDED FOR AND SHOULD NOT BE ACCESSED BY PERSONS LOCATED OR RESIDENT IN ANY JURISDICTION WHERE (BY REASON OF THAT PERSON'S NATIONALITY, DOMICILE, RESIDENCE OR OTHERWISE) THE PUBLICATION OR AVAILABILITY OF THIS WEBSITE IS PROHIBITED OR CONTRARY TO LOCAL LAW OR REGULATION OR WOULD SUBJECT ANY BLACKROCK ENTITY TO ANY REGISTRATION OR LICENSING REQUIREMENTS IN SUCH JURISDICTIONS. IT IS YOUR RESPONSIBILITY TO BE AWARE OF, TO OBTAIN ALL RELEVANT REGULATORY APPROVALS, LICENCES, VERIFICATIONS AND/OR REGISTRATIONS UNDER, AND TO OBSERVE ALL APPLICABLE LAWS AND REGULATIONS OF ANY RELEVANT JURISDICTION IN CONNECTION WITH YOUR ENTRANCE TO THIS WEBSITE.
BLACKROCK RESERVES THE RIGHT TO CHANGE, MODIFY, ADD OR REMOVE PORTIONS OF THESE TERMS AT ANY TIME FOR ANY REASON. WE SUGGEST THAT YOU REVIEW THESE TERMS PERIODICALLY FOR CHANGES. SUCH CHANGES SHALL BE EFFECTIVE IMMEDIATELY UPON POSTING. YOU ACKNOWLEDGE THAT BY ACCESSING OUR WEBSITE AFTER WE HAVE POSTED CHANGES TO THESE TERMS, YOU ARE AGREEING TO THESE TERMS AS MODIFIED.
Disclaimer
This advertisement or publication has not been reviewed by the Monetary Authority of Singapore.
This Website is owned by Blackrock (Singapore) Limited (company registration number 200010143N), which is licensed by the Monetary Authority of Singapore ("MAS") pursuant to the Securities and Futures Act (Cap. 289) of Singapore, and is managed by various companies within the BlackRock Group. BlackRock (Singapore) Limited, together with other BlackRock Group companies, shall collectively hereinafter be referred to as "BlackRock".
Nothing contained on this Website constitutes tax, accounting, regulatory, legal, insurance or investment advice. Neither the information, nor any opinion, contained on this Website constitutes a promotion, recommendation, solicitation or offer by BlackRock or its affiliates to buy or sell any securities, collective investment schemes, futures, options or other financial instruments or services, nor shall any such security, collective investment scheme, futures, options or other financial instruments or services be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase, or sale would be unlawful under the securities laws of such jurisdiction. Decisions based on information contained on this Website are the sole responsibility of the visitor. In exchange for using this Website, the visitor agrees to indemnify and hold BlackRock, its officers, directors, employees, affiliates, agents, licensors and suppliers harmless against any and all claims, losses, liability, costs and expenses (including but not limited to attorneys' fees) arising from your use of this Website, from the visitor's violation of these Terms or from any decisions that the visitor makes based on such information.
The investments and strategies discussed in the Website may not be suitable for all investors and are not obligations of BlackRock or its affiliates or guaranteed by BlackRock or its affiliates. BlackRock makes no representations that the contents are appropriate for use in all locations, or that the transactions, securities, products, instruments, or services discussed on this site are available or appropriate for sale or use in all jurisdictions or countries, or by all investors or counterparties. By making available information on the Website, BlackRock does not represent that any investment vehicle is available or suitable for any particular user. All persons and entities accessing the Website do so on their own initiative and are responsible for compliance with applicable local laws and regulations.
The funds referred to in this Website are authorized or recognized by the MAS for sale to the public in Singapore (the “Funds”). MAS authorization is not a recommendation or endorsement of a scheme nor does it guarantee the commercial merits or performances of the scheme. It does not mean that the scheme is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. The material contained in this Website has not been reviewed by the MAS or any regulatory authority in Singapore.
Investment involves risk and may lose value. If you are considering making an investment, you are advised to obtain your own independent professional advice and to carefully consider all relevant risk factors. You may wish to seek advice from a financial adviser regarding the suitability of the Funds before making a commitment to purchase units or shares in the Funds. In the event you choose not to do so, you should consider whether the Funds is suitable for you. Please contact BlackRock (Singapore) Limited or our appointed distributors for more information on how to subscribe for units or shares in the Funds. The price of units or shares and the income from them in relation to any investment may go down as well as up and any past performance is not indicative of future performance. BlackRock does not guarantee the performance of the Funds.
An investment in the Funds often involves investing in international markets. In addition to the normal risks associated with investing, international investments involve the risk of losing all or part of any capital from unfavourable fluctuations in currency values, from differences in generally accepted accounting principles or from economic or political instability in other nations. An investment in emerging markets also involves heightened other risks such as increased volatility and the possibility of lower trading volume.
When making an investment in the Funds which are listed on one or more stock exchanges, the price of the shares or units will be determined by supply and demand. It is not necessarily the same as the value per share or unit of that the Funds’ assets. At any time the share or unit price may be at a discount or premium to the asset value. However, because of the exchange-traded fund structure, it is expected that a significant discount or premium of price to asset value will not be sustainable over the long term. Any projections or examples (including calculations used therein) are for illustrative purposes only and are not guaranteed to be accurate or complete. You should note that shares or units may only be redeemed directly from the Funds by persons or entities registered as participating dealers in very large redemption sizes. Listing of the shares or units of the Funds does not guarantee a liquid market for them.
Where a Fund's investment objective is to track an index, the Fund is not sponsored, endorsed, issued, sold or promoted by the relevant index providers. None of these companies make any representation regarding the advisability of investing in the Funds.
Important information about the Funds is contained in the prospectus for the Funds which is available upon request from BlackRock. BEFORE ACQUIRING THE SHARES OR UNITS OF ANY FUNDS BY PURCHASE OR EXCHANGE, IT IS YOUR RESPONSIBILITY TO READ THE FUNDS’ PROSPECTUS OR OFFERING MATERIALS.
This Website is for information purposes only and is not intended to be relied upon as a forecast, research or investment advice. Although this material is based upon information that BlackRock considers reliable and endeavors to keep current, BlackRock does not assure that this material is accurate, current or complete, and it should not be relied upon as such. The contents of this Website have been prepared without regard to the investment objectives, financial situation, or means of any particular person or entity, and the Website is not soliciting any action based upon them. Any opinions expressed on this Website may change as subsequent conditions vary.
The information and services provided on this Website are provided "AS IS" and without warranties of any kind, either expressed or implied. To the fullest extent permissible pursuant to applicable law, BlackRock disclaims all warranties, including, but not limited to, any warranty of non-infringement of third-party rights and any implied warranties of merchantability and fitness for a particular purpose. BlackRock does not warrant, either expressly or impliedly, the accuracy or completeness of the information, text, graphics, links or other items contained on this Website and does not warrant that the functions contained in this Website will be uninterrupted or error-free, that defects will be corrected, or that the Website will be free of viruses or other harmful components. BlackRock expressly disclaims all liability for errors and omissions in the materials on this Website and for the use or interpretation by others of information contained on the Website.
Trademarks, Copyrights and other Intellectual Property
The content contained on this Website is owned or licensed by BlackRock and its third-party information providers and is protected by applicable copyrights, trademarks, service marks, and/or other intellectual property rights. Such content is solely for your personal, non-commercial use. Accordingly, you may not copy, distribute, modify, post, frame or deep link this Website, including any text, graphics, video, audio, software code, user interface design or logos. You may download material displayed on this Website for your personal use provided you also retain all copyright and other proprietary notices contained on the materials. You may not distribute, modify, transmit, reuse, repost, or use the content of this Website for public or commercial purposes, including all text, images, audio, and video, without BlackRock's written permission. Modification or use of the materials for any other purpose violates BlackRock's intellectual property rights.
All trademarks, service marks, trade names, and logos displayed on this Website are proprietary to BlackRock and/or their respective owners. Nothing contained on this Website should be construed as granting, by implication, estoppel, or otherwise, any license or right to use any trademark displayed on this Website without the written permission of BlackRock or such other third party that may own the trademark displayed on this Website. Your use of the trademarks displayed on this Website, except as provided herein, is strictly prohibited.
The use of the images displayed on this Website by you, or anyone else authorized by you, is prohibited. Any unauthorized use of the images may violate copyright laws, trademark laws, and the laws of privacy and publicity, and communications, as well as other regulations and statutes. If you download any information from this Website, you agree that you will not copy it or remove or obscure any copyright or other notices or legends contained in any such information.
Links to Other Websites
BlackRock may establish links between this Website and one or more websites operated by third parties. BlackRock has no control over any such other websites, the contents therein or the products/services offered. The existence of any such links shall not constitute an endorsement of, or representation or warranty by BlackRock regarding such websites, the contents of the websites, the products or services of the websites or the operators of the websites. Your access to and use of such linked websites is governed by the terms of use and privacy policies of those sites, and shall be at your own risk. BlackRock disclaims responsibility for the privacy policies and customer information practices of third-party internet websites hyperlinked from our Website.
Links to BlackRock from Other Websites
You shall not display hyperlinks on your websites to any website owned or operated by BlackRock. If you desire to display on your website a hyperlink to a BlackRock website, you must enter into a written agreement with BlackRock governing such display. Access to any BlackRock website does not authorize you to use any of BlackRock's names, logos, trademarks or copyrighted material, and you agree not to do so without BlackRock's express written consent. Requests to display hyperlinks on your websites to BlackRock websites should be e-mailed to clientservice.asiapac@blackrock.com.
Transmissions to and from this Website
Electronic communications can be intercepted by third parties and, accordingly, transmissions to and from this Website may not be secure. Communications to BlackRock, particularly those containing confidential information, may be sent by mail to: BlackRock (Singapore) Limited, #18-01, Twenty Anson, 20 Anson Road, Singapore 079912 or by email to clientservice.asiapac@blackrock.com. BlackRock shall be free to use, for any purpose, any ideas, concepts, know-how, or techniques provided by a website user to BlackRock through this Website. You acknowledge and agree that BlackRock has granted you limited access to the specific files pertaining to the Funds ("Approved Files"), and you agree not to attempt to access computer files other than the Approved Files. BlackRock makes no warranty to you regarding the security of the Website, including with regard to the ability of any unauthorized persons to access information received or transmitted by you through or from the Website. BlackRock reserves the right to cease providing, or to change, this Website and content of such information (or any portion or feature thereof) at any time or frequency and without notice.
Jurisdiction and Governing Law
The information provided on this Website is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject BlackRock or its affiliates to any registration requirement within such jurisdiction or country. Each investment product and service referred to on this Website is intended to be made available only to residents in Singapore.
These Terms shall be governed by, and shall be construed in accordance with, the laws of Singapore. The courts of Singapore shall have exclusive jurisdiction to hear and determine any suit, action or proceeding, and to settle any disputes, which may arise out of or in connection with these Terms and, for such purposes, you agree to submit to the jurisdiction of the courts of Singapore. Each party hereby waives any objection which it might at any time have to the courts of Singapore being nominated as the forum to hear and determine any proceedings and to settle any disputes and agrees not to claim that the courts of Singapore are not a convenient or appropriate forum.
Limitation of Liability
BLACKROCK AND ITS AFFILIATES AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES OR AGENTS WILL NOT BE LIABLE TO YOU OR ANYONE ELSE FOR ANY DAMAGES OF ANY KIND, INCLUDING, BUT NOT LIMITED TO, DIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR INDIRECT DAMAGES (INCLUDING BUT NOT LIMITED TO LOST PROFITS, TRADING LOSSES OR DAMAGES THAT RESULT FROM USE OR LOSS OF USE OF THIS WEBSITE), EVEN IF BLACKROCK HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR LOSSES, INCLUDING, WITHOUT LIMITATION, FROM THE USE OR ATTEMPTED USE OF THIS WEBSITE OR ANOTHER LINKED WEBSITE.
Timeliness of Content
All content on this Website is presented only as of the date published or indicated, and may be superseded by subsequent market events or for other reasons. In addition, you are responsible for setting the cache settings on your browser to ensure you are receiving the most recent data.
Prohibited Uses
Except as otherwise stated in these Terms or as expressly authorized by BlackRock in writing, you may not:
System Outages and Incomplete Transmissions
Internet software or transmission problems may produce inaccurate or incomplete copies of information and materials that may be downloaded and displayed on a user's computer. BlackRock is not liable for any damages, changes, or omissions that occur during transmission of information and materials.
Termination
BlackRock may terminate your access to the Website for any reason, without prior notice.
Waiver
No waiver by BlackRock of any right under or term or provision of these Terms will be deemed a waiver of any other right, term, or provision of these Terms at the time of such waiver or a waiver of that or any other right, term, or provision of these Terms at any other time.
Integration and Severability
If any provision of these Terms is deemed unlawful, void, or for any reason unenforceable, then that provision will be deemed severable from these Terms and will not affect the validity and enforceability of the remaining provisions.
The preceding Terms of use represent the entire agreement between BlackRock and the user relating to the subject matter herein.
BlackRock is an equal opportunity employer committed to diversity in the workplace.
Privacy Policy
Please review our Privacy Policy, which is a part of this Agreement and hereby incorporated by reference, to learn about our information collection practices and the measures we take to preserve the privacy and security of your information.
Dated: October 2020
© 2020 BlackRock, Inc. All rights reserved. iShares® and BlackRock® are registered trademarks of BlackRock, Inc., or its subsidiaries in the United States and elsewhere. All other trademarks, servicemarks or registered trademarks are the property of their respective owners.
On the eve of the COVID-19 pandemic, valuations were rich across most alternative asset classes. As discussed in Private markets 2020, building an outcome-oriented private markets portfolio required even more selectivity and discipline than usual.
The extreme market turbulence since then has underscored the value of thoughtful, risk-managed portfolio construction in safeguarding desired outcomes such as capital growth, enhanced income or stable income. The importance of understanding market factors within private exposures and the benefits of truly idiosyncratic and diversifying sources of return have become even clearer.
In our recent webcast, Comparing private market opportunities, Pam Chan, CIO and Global Head of BlackRock’s Alternatives Solutions Group, applied this portfolio construction lens to the task of assessing opportunities across a greatly changed alternatives landscape. Following are excerpts from her discussion with Mark Everitt, Head of Investment Research and Strategy for BlackRock Alternative Investors.
I’ll start with a major difference. Private markets have grown significantly since the global financial crisis and will play a larger role this time around, over the course of a recovery that could take several years.
Private markets have grown significantly since the global financial crisis and will play a larger role in the recovery this time around.
The private markets have tripled in size from US$2.5 trillion in December 2007 to US$7.7 trillion today, increasing from 4% to 11% of public market size, figures from Preqin and MSCI show. So private markets will provide a much larger quantum of flexible and bespoke capital that can be used to finance rescues or long-term secular opportunities that public markets may not be suited for, or where public avenues may not be available. At the same time, given the depth of private markets, we may also see dislocations specific to them, perhaps with ramifications reaching beyond that private asset class itself.
Also, the GFC educated investors on potential private market returns available during dislocations. We expect to see assets in the coming months available at very attractive prices as compared to recent history, but the question is whether those prices are attractive enough to compensate investors for the elevated levels of risk. We must underwrite investments in the context of anticipated structural shifts in the global economy.
I’ll also point to the way opportunities tend to develop on different timelines in different asset classes. By looking at how returns played out post-GFC, investors can gain insights that will be useful this time around. Using data from Preqin, we’ve looked across asset classes to understand the sequencing of opportunities post-crisis and the speed of return degradation. Here’s what we observed:
Private markets tend to exhibit less accounting volatility than public markets given valuations are less frequent and are not exposed to market sentiment. Most importantly, however, private assets are generally not subject to forced selling. Also, given that each private transaction is manufactured for a specific situation, investments may benefit from structural features that limit downside or insulate cash flows from exposure to broad market factors. Moreover, there are certain asset classes that may be inherently orthogonal or otherwise have less correlation to market factors.
As one example, a structured payout arrangement on an oil and gas overriding royalty interest may allow an investor to trade capital impairment risk for extension risk amidst the energy market selloff.
Then there are what we call “alternative alternative” (alt-alt) asset classes. Music royalties are one good example—consumer listening habits don’t change with movements in the S&P 500. Other examples include wetland mitigation credits and other forms of content IP. These niche assets make up only around 5% of the private market today but we believe they will play an increasingly important role in bolstering portfolio resilience to market turmoil. Preqin estimates that investors will allocate approximately 10% of their portfolios to a variety of niche / diversifying investments by 2023.
We spend a lot of time understanding each investment’s bottom-up risk factor exposure in order to avoid unintended concentrations of risk.
In addition to deal-level or asset class attributes, portfolio construction and risk management are critical for building resilience for the overall portfolio – hence we spend a lot of time understanding each investment’s bottom-up risk factor exposure in order to avoid unintended concentrations of risk across what may on the surface appear to be diversifying investments (see The core role of private markets in modern portfolios).
We divide these into two categories: those that arise from negative catalysts—usually liquidity needs—and those that are driven by secular trends that may be accelerated by COVID.
In terms of those driven by negative catalysts, we are beginning to see stressed and distressed opportunities. An example in rescue finance that we’ve been reviewing is a preferred equity investment with an asymmetric return profile – financing a large, high-quality, privately owned, financial institution. The company hedges their rates exposure and faced a significant margin call due to repricing. Aside from these temporal issues with their cash position, the business is otherwise robust and their need for execution certainty garners a premium.
On the other hand, we see several sectors that are well positioned given existing secular trends and new COVID-related tailwinds. For example, the increased need for remote services will potentially benefit information technology companies in software solutions, cloud computing, online education, media content and e-commerce, among other subsectors. The question here is how to access these companies, since the tailwind, paired with the relatively low capital intensity of the businesses, mean they are less likely to need additional capital for survival.
One way to gain exposure is through structured growth equity. We have observed that growth equity seems to be one of the more resilient strategies within private equity in terms of deal flow. Since 2000 growth equity has only made up 5.6% of buyout deal flow, according to Preqin. However, in a four-week period ending in late April, it made up nearly 20% of deal flow. A similar phenomenon occurred in the fourth quarter of 2008 after Lehman crashed. Growth equity made up nearly 24% of deal flow during this time.
Qualitatively we believe this might be true because growth equity is less reliant on debt financing than traditional buyouts. Along the same lines, growth equity is more reliant on increased output and improved business cash flows rather than optimizing capital structure through leverage. This lowers the overall beta to the market—the risk you are underwriting here is more company specific and idiosyncratic in nature.
One current example is with an upstart online bank. We believe the company is well-positioned to succeed given its purely online business model. The dislocation could make it possible to structure downside protection while retaining much of the upside convexity of a typical growth investment.
First, we believe there will be ample opportunity to buy well across private markets, which had been highly valued prior to this dislocation. Again, I’d underscore amidst all the uncertainty, the size and nature of the private markets today will give them a greater role in the recovery from this crisis than any one prior.
Second, the key will be flexibility - investors will need to act quickly as opportunities arise and before returns diminish. Investors may benefit by being outcome-oriented and asset class agnostic as opportunities can be expected to shift across strategies and time, and may dissipate quickly as capital flows in.
Third, portfolio resilience requires re-underwriting existing and carefully assessing new investments through a lens of market risk exposure. Constructing one’s portfolios in a risk-diversified manner is critical and, where possible, incorporating more orthogonal or alt-alt investments to capture non-market drivers of return can help.