BlackRock has launched a securitised fund - primarily focused on European and UK assets - to meet the demand for securitised assets from clients seeking diversified fixed income exposures.
A part of the BlackRock Specialist Strategies Fund range, the BlackRock Senior Securitised Fund (BSSF) is classified under the EU's Sustainable Finance Disclosure Regulation as Article 8. The fund can also invest up to 25% in the US and other regions.
The firm stated that clients have shown interest in diversification benefits, limited exposure to interest rate risk, and the yield premium often provided by securitised assets compared to corporate credit.
The fund is actively managed with an unconstrained investment style, disregarding benchmark indices in the selection process. Investors should use the three-month SONIA compounded in arrears to compare the fund's performance, suggested the firm.
As an Irish-domiciled alternative investment fund, BSSF invests in both primary and secondary offerings of securitised assets.
It focuses on the "higher quality portion of the capital structure", with a minimum exposure of 75% to AAA assets and a minimum rating of AA-.
BSSF maintains a minimum exposure of 65% to Asset-backed securities (ABS) and a maximum exposure of 35% to collateralised loan obligations.
Kate Galustian, lead portfolio manager, BlackRock senior securitised fund and head of European ABS, added: “The fund leverages BlackRock’s experience in the securitised market to identify investment opportunities that have the potential to offer clients attractive risk-adjusted returns throughout the cycle. The fund seeks to maximise total return by investing in high grade, predominately AAA, securitised assets, consistent with the principles of ESG investing.”
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