Fixed Income

BlackRock Sustainable Sterling Strategic Bond Fund

  • Bid price as of 26/May/2023 GBP 0.92
  • Offer price as of 26/May/2023 GBP 0.93
  • Morningstar Rating

Overview

Investment Approach

The Fund aims to provide a return on your investment (generated through an increase to the value of the Fund’s assets and/or income received from those assets) of 4.5% per year (gross of fees) over the return of the 3-month Sterling Overnight Index Average in a manner consistent with the principles of sustainable investment. The Fund invests at least 80% of its total assets in fixed income (FI) securities (such as bonds) globally, and instruments related to such FI securities (i.e. other investments whose value is related to debt) and at least 50% of its total assets in Sterling denominated non-government FI securities that are investment grade (i.e. meet a specified level of creditworthiness) at the time of purchase and instruments related to such FI securities. However, the Fund will invest in the full range of FI securities which may include investments with a relatively low credit rating or which are unrated. The FI securities may be issued by companies, governments, government agencies and supranationals (e.g. the International Bank for Reconstruction and Development). The Fund may also invest in equity securities (e.g. shares) of companies and in asset backed and mortgage backed securities (i.e. financial securities backed by cash flows from debt), money market instruments (i.e. debt securities with short-term maturities), deposits, cash and other funds.

Important Information: Capital at Risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

All currency hedged share classes of this fund use derivatives to hedge currency risk. The use of derivatives for a share class could pose a potential risk of contagion (also known as spill-over) to other share classes in the fund. The fund’s management company will ensure appropriate procedures are in place to minimise contagion risk to other share class. Using the drop down box directly below the name of the fund, you can view a list of all share classes in the fund – currency hedged share classes are indicated by the word “Hedged” in the name of the share class. In addition, a full list of all currency hedged share classes is available on request from the fund’s management company

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Performance

Performance

Chart

Performance chart data not available for display.
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Unit Class performance displayed in British Pound. Source: BlackRock. Performance is shown on a bid to bid price basis, with net income reinvested, net of fees. Past performance is not a reliable indicator of current or future performance.


Distributions

Record Date Ex-Date Payable Date
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Record Date Ex-Date Payable Date Total Distribution

This chart shows the fund's performance as the percentage loss or gain per year over the last 3 years.

  2018 2019 2020 2021 2022
Total Return (%) 8.0 0.5 -9.8
  1y 3y 5y 10y Incept.
Total Return (%) 0.47 1.64 - - 1.28
Target Benchmark 1 (%) - - - - -
  YTD 1m 3m 6m 1y 3y 5y 10y Incept.
Total Return (%) 4.71 0.73 0.24 10.10 0.47 5.00 - - 4.99
Target Benchmark 1 (%) 2.75 0.71 2.07 4.03 - - - - -
  From
31-Mar-2018
To
31-Mar-2019		 From
31-Mar-2019
To
31-Mar-2020		 From
31-Mar-2020
To
31-Mar-2021		 From
31-Mar-2021
To
31-Mar-2022		 From
31-Mar-2022
To
31-Mar-2023
Total Return (%)

as of 31/Mar/2023

- - 18.16 -1.84 -3.45

The figures shown relate to past performance. Past performance is not a reliable indicator of future performance. Markets could develop very differently in the future. It can help you to assess how the fund has been managed in the past

Share Class and Benchmark performance displayed in GBP hedged Share Class Benchmark performance is displayed in GBP.

Performance is shown on a Net Asset Value (NAV) basis, with gross income reinvested where applicable. The return of your investment may increase or decrease as a result of currency fluctuations if your investment is made in a currency other than that used in the past performance calculation. Source: Blackrock

Key Facts

Key Facts

Net Assets of Fund as of 26/May/2023 GBP 89,310,937
Share Class launch date 02/Jul/2019
Fund Launch Date 17/May/2016
Share Class Currency GBP
Fund Base Currency GBP
Asset Class Fixed Income
Target Benchmark 1 3 Month SONIA ARR compounded in arrears + 450 bps
Investment Association Category £ Strategic Bond
Initial Charge 5.00%
Ongoing Charges Figures 0.54%
Annual Management Fee 0.45%
Performance Fee 0.00%
Minimum Initial Investment GBP 50,000,000.00
Minimum Subsequent Investment GBP 100.00
Distribution Frequency -
Use of Income Distributing
Domicile United Kingdom
Regulatory Structure UCITS
Management Company BlackRock Fund Managers Ltd
Morningstar Category GBP Flexible Bond
Dealing Settlement Trade Date + 3 days
Dealing Frequency Daily, forward pricing basis
Bloomberg Ticker BLSSBSG
ISIN GB00BFK3LW26
SEDOL BFK3LW2

Portfolio Characteristics

Portfolio Characteristics

Number of Holdings as of 28/Apr/2023 77
12m Trailing Yield as of 30/Apr/2023 2.82
Standard Deviation (3y) as of 30/Apr/2023 10.06%
3y Beta as of - -
Yield to Maturity as of 28/Apr/2023 6.27
Modified Duration as of 28/Apr/2023 4.52
Weighted Average YTM as of 28/Apr/2023 6.49%
Effective Duration as of 28/Apr/2023 4.16
Weighted Avg Maturity as of 28/Apr/2023 5.57
WAL to Worst as of 28/Apr/2023 5.57

Sustainability Characteristics

Sustainability Characteristics

Sustainability Characteristics provide investors with specific non-traditional metrics. Alongside other metrics and information, these enable investors to evaluate funds on certain environmental, social and governance characteristics. Sustainability Characteristics do not provide an indication of current or future performance nor do they represent the potential risk and reward profile of a fund. They are provided for transparency and for information purposes only. Sustainability Characteristics should not be considered solely or in isolation, but instead are one type of information that investors may wish to consider when assessing a fund.


The metrics are not indicative of how or whether ESG factors will be integrated into a fund. Unless otherwise stated in fund documentation and included within a fund’s investment objective, the metrics do not change a fund’s investment objective or constrain the fund’s investable universe, and there is no indication that an ESG or Impact focused investment strategy or exclusionary screens will be adopted by a fund. For more information regarding a fund's investment strategy, please see the fund's prospectus.


Review the MSCI methodologies behind Sustainability Characteristics using the links below.

MSCI ESG Fund Rating (AAA-CCC) as of 19/May/2023 AA
MSCI ESG % Coverage as of 19/May/2023 90.46
MSCI ESG Quality Score (0-10) as of 19/May/2023 7.52
MSCI ESG Quality Score - Peer Percentile as of 19/May/2023 97.60
Fund Lipper Global Classification as of 19/May/2023 Bond GBP
Funds in Peer Group as of 19/May/2023 167
MSCI Weighted Average Carbon Intensity (Tons CO2E/$M SALES) as of 19/May/2023 103.33
MSCI Weighted Average Carbon Intensity % Coverage as of 19/May/2023 83.20
All data is from MSCI ESG Fund Ratings as of 19/May/2023, based on holdings as of 31/Oct/2022. As such, the fund’s sustainable characteristics may differ from MSCI ESG Fund Ratings from time to time.

To be included in MSCI ESG Fund Ratings, 65% (or 50% for bond funds and money market funds) of the fund’s gross weight must come from securities with ESG coverage by MSCI ESG Research (certain cash positions and other asset types deemed not relevant for ESG analysis by MSCI are removed prior to calculating a fund’s gross weight; the absolute values of short positions are included but treated as uncovered), the fund’s holdings date must be less than one year old, and the fund must have at least ten securities.

Business Involvement

Business Involvement

Business Involvement metrics can help investors gain a more comprehensive view of specific activities in which a fund may be exposed through its investments.


Business Involvement metrics are not indicative of a fund’s investment objective, and, unless otherwise stated in fund documentation and included within a fund’s investment objective, do not change a fund’s investment objective or constrain the fund’s investable universe, and there is no indication that an ESG or Impact focused investment strategy or exclusionary screens will be adopted by a fund. For more information regarding a fund's investment strategy, please see the fund's prospectus.


Review the MSCI methodology behind the Business Involvement metrics, using links below.

MSCI - Controversial Weapons as of 28/Apr/2023 0.00%
MSCI - UN Global Compact Violators as of 28/Apr/2023 0.00%
MSCI - Nuclear Weapons as of 28/Apr/2023 0.00%
MSCI - Thermal Coal as of 28/Apr/2023 0.00%
MSCI - Civilian Firearms as of 28/Apr/2023 0.00%
MSCI - Oil Sands as of 28/Apr/2023 0.00%
MSCI - Tobacco as of 28/Apr/2023 0.00%
Business Involvement Coverage as of 28/Apr/2023 74.42%
Percentage of Fund not covered as of 28/Apr/2023 25.58%
BlackRock business involvement exposures as shown above for Thermal Coal and Oil Sands are calculated and reported for companies that generate more than 5% of revenue from thermal coal or oil sands as defined by MSCI ESG Research. For the exposure to companies that generate any revenue from thermal coal or oil sands (at a 0% revenue threshold), as defined by MSCI ESG Research, it is as follows: Thermal Coal 0.00% and for Oil Sands 1.32%.

Business Involvement metrics are calculated by BlackRock using data from MSCI ESG Research which provides a profile of each company’s specific business involvement. BlackRock leverages this data to provide a summed up view across holdings and translates it to a fund's market value exposure to the listed Business Involvement areas above.


Business Involvement metrics are designed only to identify companies where MSCI has conducted research and identified as having involvement in the covered activity. As a result, it is possible there is additional involvement in these covered activities where MSCI does not have coverage. This information should not be used to produce comprehensive lists of companies without involvement. Business Involvement metrics are only displayed if at least 1% of the fund’s gross weight includes securities covered by MSCI ESG Research.

ESG Integration

ESG Integration

ESG integration is the practice of incorporating material environmental, social and governance (ESG) information or insights alongside traditional measures into the investment decision process to improve long term financial outcomes of portfolios. Unless otherwise stated in Fund documentation or included within the Fund’s investment objective, inclusion of this statement does not imply that the Fund has an ESG-aligned investment objective, but rather describes how ESG information is considered as part of the overall investment process.


The Fund manager includes ESG considerations in combination with other information in the research and due diligence phase of the investment process. ESG information may be sourced internally, via collaboration with the BlackRock Investment Stewardship team in engaging issuers on material environmental, social or governance topics, or from third-party providers. The Fund manager’s ongoing monitoring of the portfolio involves regular portfolio risk reviews with the Risk and Quantitative Analysis group. These reviews include discussion of the portfolio’s exposure to material ESG risks, as well as exposure to sustainability-related business involvements, climate-related metrics, and other factors.

Risk Indicator

Risk Indicator

1
2
3
4
5
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7
Low Risk High Risk
Typically low rewards Typically high rewards

Ratings

Ratings

Morningstar Rating

4 stars
Overall Morningstar Rating for BlackRock Sustainable Sterling Strategic Bond Fund, Class S, as of 31/Jan/2023 rated against 70 GBP Flexible Bond Funds.

Holdings

Holdings

as of 28/Apr/2023
Name Weight (%)
UNITED KINGDOM OF GREAT BRITAIN AN 4.125 01/29/2027 4.23
UK CONV GILT 4.25 06/07/2032 3.69
BANCO SANTANDER SA MTN RegS 4.75 08/30/2028 2.89
TIME WARNER CABLE LLC 5.75 06/02/2031 2.74
CREDIT SUISSE GROUP AG MTN RegS 0.625 01/18/2033 2.73
Name Weight (%)
LEGAL & GENERAL GROUP PLC RegS 5.125 11/14/2048 2.69
NGG FINANCE PLC RegS 5.625 06/18/2073 2.43
ELECTRICITE DE FRANCE SA MTN RegS 5.875 12/31/2079 2.42
DIGITAL DUTCH FINCO BV RegS 1.25 02/01/2031 2.26
GOLDMAN SACHS GROUP INC/THE MTN RegS 3.625 10/29/2029 2.23
Holdings subject to change

Exposure Breakdowns

Exposure Breakdowns

as of 28/Apr/2023

% of Market Value

Type Fund Benchmark Net
as of 28/Apr/2023

% of Market Value

Type Fund Benchmark Net
as of 28/Apr/2023

% of Market Value

Type Fund Benchmark Net
Negative weightings may result from specific circumstances (including timing differences between trade and settle dates of securities purchased by the funds) and/or the use of certain financial instruments, including derivatives, which may be used to gain or reduce market exposure and/or risk management. Allocations are subject to change.

Pricing & Exchange

Pricing & Exchange

Investor Class Currency Distribution Frequency Bid Price Offer Price ISIN TIS
Class S GBP - 0.92 0.93 GB00BFK3LW26 -
Class D GBP None 1.19 1.20 GB00BZ6DDJ74 -
Class X GBP None 1.24 1.25 GB00BZ6DDP35 -
Class Z GBP None 1.20 1.21 GB00BZ6DDZ33 -
Class X GBP Daily 1.02 1.03 GB00BZ6DDQ42 -
Class Z GBP Daily 1.02 1.03 GB00BZ6DF359 -
Class D GBP Daily 1.02 1.03 GB00BZ6DDM04 -
Class A GBP None 1.15 1.15 GB00BZ6DDG44 -
Class A GBP Daily 1.02 1.03 GB00BZ6DDH50 -

Portfolio Managers

Portfolio Managers

Simon Blundell
Simon Blundell

Managing Director, is Head of the Fundamental Sterling Team within BlackRock's Global Fixed Income (GFI) Group.

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Managing Director, is Head of the Fundamental Sterling team within BlackRock's Global Fixed Income (GFI) Group. Prior to joining BlackRock in 2011, Simon was Head of Institutional Credit Portfolio Management at Aviva Investors where he oversaw 9 billion in assets across Euro, Sterling, and Global credit and aggregate products. Prior to joining Aviva in 2009, Simon spent 10 years at ABN AMRO Asset Management (later acquired by Fortis Investments where he stayed on for a year), most recently as Head of Credit. He previously held positions at HSBC Asset Management and Morgan Grenfell Asset Management. He began his investment career in 1994.

Ben Edwards
Ben Edwards

Ben Edwards, CFA, Managing Director, is a Portfolio Manager in the Sterling Bond Portfolio team within BlackRock's Global Fixed Income Group. Mr. Edwards is the lead fund manager of the BlackRock Corporate Bond Fund and co-manager of the BlackRock Sterling Strategic Bond Fund.

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Ben Edwards, CFA, Managing Director, is a Portfolio Manager in the Sterling Bond Portfolio team within BlackRock's Global Fixed Income Group. Mr. Edwards is the lead fund manager of the BlackRock Corporate Bond Fund and co-manager of the BlackRock Sterling Strategic Bond Fund.

 

Prior to joining BlackRock in 2010, Mr. Edwards worked at Legal and General Investment Management from 2003 to 2009 where he was a portfolio manager, responsible for both institutional and retail sterling corporate bond portfolios. He began his career as an Analyst at M&G in 2002.

 

Mr. Edwards earned a Business degree from the Queensland University of Technology (Aust.) in 2000 and post-graduate qualifications in Finance from the Financial Services Institute of Australia in 2002. He is a CFA charterholder.

Literature

Literature