US asset manager BlackRock has launched the BlackRock Global Funds Dynamic High Income fund, managed by Michael Fredericks, Justin Christofel and Alex Shingler.
The trio is part of the firm’s multi-asset income investing team, looking after $30bn (€24.2bn) in assets. The strategy was initially launched in the US as a 1940 Act mutual fund in November 2014.
The fund invests in asset classes complementary to traditional income investments, including global REITs, preferred stocks, floating rate loans, mortgage-backed securities and equity covered call options.
Flexibility is a core driver of the fund’s asset allocation as it seeks a balance between consistent, high-income and attractive total return, while managing risk relative to a 70% equity / 30% bond risk benchmark.
Michael Fredericks, lead portfolio manager of the BGF Dynamic High Income fund and head of Income Investing for Multi-Asset Strategies at BlackRock, said: “With yield hard to come by in today’s investment landscape, it is important for investors to look beyond their usual sources of income. We see attractive opportunities across less traditional income asset classes, whose correlation to conventional stocks and bonds is typically quite low. Investors can benefit from this unique multi-asset strategy for attractive, diversifying sources of income.”
Michael Gruener, head of EMEA Retail at BlackRock, added: “In today’s ‘low for longer’ interest rate environment, finding attractive income is no longer as easy as it once was. As traditional income sources become more crowded, investors are seeking new sources of income that complement what they already own. The BGF Dynamic High Income fund provides investors with the high level of income they are looking for while offering exposure to less commonly held, complementary income producing asset classes.”
BlackRock had $6.28trn (€5.07trn) in assets as of 31 December 2017.