BlackRock has bolstered its diversified equity absolute return franchise with a new launch for the firm’s Scientific Active Equity (SAE) platform, Citywire Selector has learned.
The BSF Asia Pacific Diversified Equity Absolute Return fund is domiciled in Luxembourg and will be managed by BlackRock’s co-CIO of active equity and co-head of scientific equity, Jeff Shen.
Shen currently runs several funds at the firm, including the Hong Kong only, BPF – BlackRock Asian Enhanced Equity Yield fund.
Also managing the fund will be Michael Lemmon, who is currently a member of the SAE team.
SAE’s absolute return strategies aim to focus on stock specific drivers and mitigate directional market risk to deliver diversification benefits from traditional portfolios. This may be tilted to long-only investments.
As part of the SAE platform, the managers aim to combine fundamental investment research with big data analytics to leverage technology such as natural language processing and machine learning, in order to unearth inefficiencies at the local market level.
The portfolio will take long and short positions in 3,000-3,500 stocks across three market-neutral sub-strategies, which will compromise of Asia Pacific large cap, Asia Pacific small cap, and Asia Pacific mid-horizon.
In a letter to clients, BlackRock said: ‘Where others may see challenges, we see opportunities. We believe through applying a quantitative approach to an asset class with ample potential for alpha production, that a market-neutral Asia Pacific strategy can be a unique source of uncorrelated performance for investors.’
The team began investing in Asian equities in 2003 and currently runs $10 billion in assets under management, with team members based in San Francisco, Sydney, and Tokyo.
The fund was launched on February 22 and is available for sale in Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Spain, Sweden, UK.