For whatever shape the market is in

For whatever shape the market is in

BlackRock’s range of income solutions are designed to withstand the economy’s ups and downs, no matter how it’s looking, so you can achieve the outcomes you want.

New income sources for a new normal

The policy revolution in the wake of COVID-19 has led to a blurring of fiscal and monetary policies plus government intervention in economies and financial markets. The resulting mix is ballooning debt, tight spreads, higher bond prices, historically low yields and looming inflation. This doesn’t bode well for investors who seek government bonds as a cushion against risk asset sell-offs.

Yet income-generating assets still play a key role within a total portfolio. This is not just due to the stability of income stream they generate to fund near term obligations or operating expenses – but also to add resilience in a world where volatility seems here to stay.

Against this backdrop, more considered ways to diversify are essential to ensure sufficient strategic exposure. This paves the way for both institutional and individual investors towards sustainable assets, private markets and deliberate country diversification.

Full report

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Investors will need to rethink how they diversify their portfolios as traditional bonds may no longer be the portfolio stabilizers they once were.

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Michael Fredericks Head of Income Investing, BlackRock Multi-Asset Strategies

How do low interest rates shape investing? 

On this episode of the BlackRock Bottom Line, Michael Fredericks, Head of Income Investing, explores how record-low rates have changed investing, and how investors need to broaden their opportunities that define higher income and portfolio diversification.

The tradeoff of Income Investing

It’s harder than ever to find compelling income and downside management in individual asset classes.

The tradeoff of Income Investing

 

The figures shown relate to past performance. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy. Source: BlackRock, Morningstar and Bloomberg. Yields as of 31/08/2020. Fixed income yields represented by yield-to-worst and equity yields by 12 month dividend yield. Average annual drawdown is the average of the largest declines in value from peak to trough during each of the following periods: 2015, 2016, 2017, 2018, 2019, YTD 2020. US Treasuries: Barclays US Treasury 7-10 Yr. Global Inv Grade: Barclays Global Agg Corporate (USD). US HY Barclays US HY 2% Issuer Cap. Global Equities: MSCI World. High Dividend Equities: MSCI World High Div Yield. EMD: JPM EMBI Global. Bank Loans: S&P/LSTA Leveraged Loan Index. Preferred Stock S&P Preferred Stock. REITs: FTSE NAREIT All REITs Index. Returns are net and for illustrative purposes only. Index performance is for illustrative purpose only. Investors cannot directly invest into an index.

Key takeaways for investors

Diversification
Go beyond asset class diversification

Have a granular analysis of your portfolio at country and sector levels.
Income
Consider non-traditional sources of income
This includes covered call writing, floating rate loans, listed real asset securities, global REITs etc.
Access Key
Tap into private investment opportunities
They deliver potentially similar income as publicly listed assets with a lower correlation.
Sustaimability
Apply a lens of sustainability

Although yields on sustainable funds might be lower, they can bolster resiliency.

Why BlackRock for Income?

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Breadth of Expertise
Our market access and scale extends across regions, asset classes and investment styles, enabling you to achieve your optimal income allocation.
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Flexible Implementation
We seek to deliver income in various forms. Our funds can fit as a core, satellite or tactical allocation into your portfolio, preferences and investment goals.
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Focus on Risk Management
Our in-house technology and dedicated risk and quantitative analytics teams help mitigate unwanted surprises.

To find out more, speak to your financial advisers below

 

CIMB Bank Citibank DBS
DollarDEX FSM Maybank
OCBCbank PhilipsCapital POSB
RHB SAXO Capital Markets Standard Chartered
UOB UOB Kayhian