A guide to Equity investing in 2020

Helping investors to grow, and grow well

A guide to investing in equities.

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. You may not get back the amount originally invested.

A guide to equity investing: from index to private markets

The equity-investing landscape remains in constant change, reflecting innovations across areas such as investment strategies, regulation and portfolio construction. Following is a brief overview of some of these areas.

To find out more read our report A guide to investing in equities.

The equity-investing spectrum

There are many different ways to invest in equities. Here we provide a simplified overview of five possible strategies:

Index strategies
Index
Can be at the core of the portfolio to express broad market views.
Factor strategies
Factors
Can help to ensure that the portfolio is exposed to diversified factors and those relevant to the current economic regime.
Long-only active equity strategies
Long-only active equity strategies
Can generate additional returns from factor timing and security selections.
Hedge fund strategies
Equity hedge funds
Can provide additional portfolio diversification and the ability to earn excess returns from short positions, regardless of the market environment
Private equity markets
Private equity
Can open up diversification opportunities for investors

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. The investor may not get back the amount originally invested.  

Building an equity portfolio

When it comes to selecting across different investment styles and strategies, we believe, it is important to consider the following aspects:

  1. The overall portfolio objective – what does the investor aim to achieve?
  2. Cost/ fee budget – how much does the investor want to spend?
  3. Time and research capabilities – how wide will the search be for investments and managers?
  4. Accessibility of tools and technology – what tools are at the investor’s disposal?
  5. Knowledge of the market – how much does the investor have?

To find out more about building an equity portfolio, download our guide.

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. The investor may not get back the amount originally invested.  

Download the guide

Current Investment Trends

Equity investing is continuously evolving. Here we look at three key drivers of change that we believe could shape a successful equity portfolio:

1. Sustainable investing
There has never been greater social and political attention paid to macroeconomic themes such as climate change, with governments being held to account for their commitment to climate outcomes. There is also greater focus from investors themselves in aligning their values with their portfolio.
BlackRock Sustainable equity funds range

This information should not be relied upon as research, investment advice, or a recommendation regarding any products, strategies, or any security in particular. This is for illustrative and informational purposes and is subject to change. It has not been approved by any regulatory authority or securities regulator. The environmental, social and governance (“ESG”) considerations discussed herein may affect an investment team’s decision to invest in certain companies or industries from time to time. Results may differ from portfolios that do not apply similar ESG considerations to their investment process.

2. Data and Technology
The new technologies that have changed our lives have also transformed the amount of data that’s available. This can provide valuable insights into company and industry prospects and can allow investors to access differentiated sources of return and gain exposure to alpha opportunities.
BlackRock Big Data equity funds range
3. Megatrends
Most major economies are undergoing powerful shifts. Rapid urbanisation is changing consumer behaviour and the ubiquity of technology is redefining business models in a host of industries and unleashing widespread disruption. These powerful transformations are creating new investment themes.
BlackRock Megatrends equity funds range

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. The investor may not get back the amount originally invested.