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Focus on BlackRock fund flows: biggest inflows and outflows

In a new series, Citywire Selector compares the three-year returns of major AM firms' funds with their popularity among investors.

Flows vs. performance

Investors can withdraw their money from a fund for numerous reasons including performance, a change of managers or uncertainty in the market.

In this series Citywire Selector looks at the relationship between the three-year performance of a fund against its Citywire-assigned benchmark as well as the recent interest, measured by the amount of money it attracted from investors over the first half of 2017.

Using Citywire data, this gallery highlights funds at BlackRock to see which experienced the biggest inflows and outflows over the near-term. Read on to find out whether investor interest coincides with longer-term outperformance.

Note: Flows figures based on Citywire data to the end of June 2017. Performance based on Lipper data compared to a Citywire-assigned benchmark over the three-year period covering July 2014-July 2017.

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Fund: BGF Emer Mkts Loc Curr Bd

Net flows: €1.71 billion ($2.02 billion)

The $4.5 billion BGF Emer Mkts Loc Curr Bd has the worst performance out of all the funds in this four-strong line-up, but has seen the second highest inflows over the first half of 2017.

Narrowly underperforming its benchmark, the fund’s performance has picked up since November 2016 suggesting that investors believe the performance will continue to improve as sentiment towards the emerging markets becomes more supportive. Over the six month time period, assets in the sector improved by 23% across all asset managers meaning that the increased assets in the fund reflect the wider trends in the market.

Managed by Laurent Develay, Sergio Trigo Paz, and Michal Wozniak, the fund’s largest country allocation is Mexico at 12.4%. This is followed by Poland at 12.3% and Brazil at 10.9%. The managers also have a cash holding of 7.6%.

Estimated net flows derived from Lipper data using monthly data points. Assets across all a fund’s share classes are included with performance stripped out. The universe covers all active mutual fund assets Citywire has fund managers assigned to in the global ex US peer group. Time period: 3 years to 31/07/2017.

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Fund: BGF Global Multi-Asset Income

Net flows: +€1.98 billion ($2.33 billion)

The $7.2 billion BGF Global Multi-Asset Income fund has been run by Michael Fredericks since April 2013, while Justin Christofel joined November 2013. Alex Shingler was the most recent addition, coming on board in March 2015.

The fund has seen the highest inflows out of all the cross-border funds at BlackRock. While the fund is underperforming its benchmark, the three-year total return is more than double of its average peer in the Multi Asset - Flexible USD sector, who returned 4.4%.

In terms of holdings, the largest asset class in the fund is US fixed income at 46.52%, while non-US fixed income makes up 22.64%. BB rated credits account for 22.99% of the fund, while the managers devote 15.63% of the fund to BBB rated credit. In terms of equities, this is spilt between non-US equity (13.64%) and US equities (13.46%) The managers also hold 3.75% in cash and derivatives.

Estimated net flows derived from Lipper data using monthly data points. Assets across all a fund’s share classes are included with performance stripped out. The universe covers all active mutual fund assets Citywire has fund managers assigned to in the global ex US peer group. Time period: 3 years to 31/07/2017.

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Fund: BGF European Focus

Net flows: -€803 million (-$946 million)

The €1 billion BGF European Focus fund has been managed by Nigel Bolton since March 2008, while Simon Hunter joined him on the fund in November 2016. The fund has had the best three year performance in the line-up, but has seen the second highest level of outflows.

Comparing the fund’s performance against its peers in the European equity sector, which has had an admittedly difficult period of recent performance, could explain the high outflows. The average manager in the sector returned 20% over three years, while this fund managed just 15.4% and is ranked 645 out of 877 funds.

In terms of holdings, the managers hold 43 stocks, with tobacco giant British American Tobacco the largest bet at 4.21% of exposure. The largest sector in the fund is financials at 21.22%, while 34.34% of the fund is devoted to the UK.

Estimated net flows derived from Lipper data using monthly data points. Assets across all a fund’s share classes are included with performance stripped out. The universe covers all active mutual fund assets Citywire has fund managers assigned to in the global ex US peer group. Time period: 3 years to 31/07/2017.

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Fund: BGF Global Allocation

Net flows: -€987 million ($1.16 billion)

The $18.4 billion BGF Global Allocation fund has seen the largest outflows of the cross-boarder funds offered by BlackRock.

It is narrowly underperforming the sector’s average manager at 9.05%, while also trailing its Citywire-assigned benchmark. However, manager changes rather than the performance of the fund could be linked to increased redemptions.

In December 2016 Aldo Roldan’s role changed on the fund from manager to an adviser helping with research and analysis. Dennis Stattman, who has managed the strategy available to US investors since 1989, entered retirement in August 2017.

Dan Chamby is now the longest-serving member on the fund, having managed the US strategy since 2003. David Clayton, Kent Hogshire and Russ Koesterich joined him in January 2017.

In terms of holdings, the majority of the fund (56.12%) is in equity and fixed income makes up 32.71% for the fund. US equity is the largest allocation in the fund, while the managers also hold 6.37% of the fund as cash.

Estimated net flows derived from Lipper data using monthly data points. Assets across all a fund’s share classes are included with performance stripped out. The universe covers all active mutual fund assets Citywire has fund managers assigned to in the global ex US peer group. Time period: 3 years to 31/07/2017.

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Related Fund Managers

Dan Chamby
Dan Chamby
162/216 in Mixed Assets - Balanced USD (Performance over 3 years) Average Total Return: 11.71%
Justin Christofel
Justin Christofel
133/137 in Mixed Assets - Aggressive GBP (Performance over 3 years) Average Total Return: 13.64%
Laurent Develay
Laurent Develay
6/125 in Bonds - Emerging Markets Global Local Currency (Performance over 3 years) Average Total Return: 11.65%
Sergio Trigo Paz
Sergio Trigo Paz
5/125 in Bonds - Emerging Markets Global Local Currency (Performance over 3 years) Average Total Return: 11.65%
Michal Wozniak
Michal Wozniak
1/125 in Bonds - Emerging Markets Global Local Currency (Performance over 3 years) Average Total Return: 21.04%
Aldo Roldan
Aldo Roldan
Dennis Stattman
Dennis Stattman
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