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What is a Wholesale Client?
A person or entity is a “wholesale client” if they satisfy the requirements of section 761G of the Corporations Act.
This commonly includes a person or entity:
As yields from cash and government bonds remain at near historic lows, the search for income is a top priority for many investors. We believe a multi-asset approach is one of the best ways to generate a good level of income in current market conditions. Enhance your income potential with a comprehensive portfolio including High Yield, Emerging Market Debt, Investment Grade and Corporate Bonds.
The growth of the fixed income ETF market has helped create a new source of liquidity for bond investors, above and beyond what you can access in the OTC market. With fixed income ETFs, you effectively get an additional trading venue—the stock exchange—where shares can be transferred among investors without relying on the OTC market.
ETFs can offer an additional source of liquidity for fixed income investors
iShares ETFs generally offer price improvement, making the ETF less expensive to trade than a comparable portfolio of bonds. Relative to a basket of bonds, ETFs offer the benefit of on-exchange liquidity, which often results in lower transaction costs.
ETFs may provide bond investors with significant cost savings
You can find more sources of income by taking a multi-asset approach. Use the toolkit below to increase your income potential.
High yield has historically outperformed other fixed income asset classes in recovering markets with rising interest rates1 and continues to be supported by solid fundamentals.2
The quality and risk profile of the emerging market debt market has seen considerable improvement in recent years. Low correlation to developed market debt and emerging market equities has made this asset class a popular vehicle for diversification.
For more defensive income seekers, global investment grade corporate bonds offer higher credit quality, while accessing yield from exposure to leading companies across a range of sectors and geographies.
1BlackRock 30/06/15: High yield (as represented by Barclays Capital US High Yield Index) has outperformed Treasuries (as represented by Barclays Capital US Treasury Index) and Bank Loans (as represented by “S&P Leveraged Loan Index).
2BlackRock 30/06/15: Default risk is currently half the long-term average, as measured by the J.P. Morgan Global High Yield Index, 1987- June 2015.
A single iShares trade can provide instant exposure to a diversified portfolio of securities, by asset class, market capitalisation, country or sector. This diversification can help reduce concentration risk and give investors exposure to additional sources of potential return when building income portfolios.
Management and transaction costs have the potential to have a meaningful impact on the return of an income portfolio. iShares can be a cost-effective way to gain exposure to a diversified portfolio of securities. iShares are generally less expensive than investing in actively managed funds and even some index funds, and can also be less costly than purchasing a large number of individual shares or bonds.
With the minimum investment size for some bonds being up to $500,000, it can be difficult to achieve a diversified exposure to income assets. With iShares you can easily gain access to a diversified portfolio of fixed income securities through a simple trade on the ASX.
By trading like shares, iShares provide investors with the flexibility to trade at any time during ASX market hours. This gives investors the flexibility to tailor and adapt their portfolios towards their specific income objectives with ease.
The holdings of each iShares are publicly disclosed daily, so that investors always know exactly what they hold in their portfolios and can better understand sources of risk and return.
BlackRock’s purpose is to help more and more people experience financial well-being. As a fiduciary to investors and a leading provider of financial technology, we help millions of people build savings that serve them throughout their lives by making investing easier and more affordable. For additional information on BlackRock, please visit www.blackrock.com/corporate
PERFORMANCE DATA
Performance figures represent past performance. Performance is not indicative of future performance and current performance may be higher or lower than the performance shown. Net performance figures are calculated after fund management fees and expenses, and assume reinvestment of distributions. Gross performance figures are calculated gross of ongoing fees and expenses. Unless otherwise stated, fund net performance (excluded iShares ETFs) is calculated on an exit-to-exit price basis, while iShares ETF net performance is calculated on a NAV price basis. Unless otherwise stated, performance for periods greater than one year is annualised and performance calculated to the last business day of the month.
IMPORTANT INFORMATION
Issued by BlackRock Investment Management (Australia) Limited ABN 13 006 165 975, AFSL 230 523 (BIMAL) for the exclusive use of the recipient, which warrants by receipt of this material that it is a wholesale client as defined under the Australian Corporations Act 2001 (Cth).
This material provides general information only and does not take into account your individual objectives, financial situation, needs or circumstances. Before making any investment decision, you should assess whether the material is appropriate for you and obtain financial advice tailored to you having regard to your individual objectives, financial situation, needs and circumstances. Refer to BIMAL’s Financial Services Guide on its website for more information. This material is not a financial product recommendation or an offer or solicitation with respect to the purchase or sale of any financial product in any jurisdiction.
Information provided is for illustrative and informational purposes and is subject to change. It has not been approved by any regulator.
This material is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. BIMAL is a part of the global BlackRock Group which comprises of financial product issuers and investment managers around the world. BIMAL is the issuer of financial products and acts as an investment manager in Australia. BIMAL is the responsible entity and issuer of units in the Australian domiciled managed investment schemes referred to in this material, including the Australian domiciled iShares ETFs. Any potential investor should consider the latest product disclosure statement (PDS) before deciding whether to acquire, or continue to hold, an investment in any BlackRock fund. BlackRock has also issued a target market determination (TMD) that describes the class of consumers that comprises the target market for each BlackRock fund and matters relevant to their distribution and review. The PDS and the TMD can be obtained by contacting the BIMAL Client Services Centre on 1300 366 100. In some instances the PDS and the TMD are also available on the BIMAL website at www.blackrock.com/au. An iShares ETF is not sponsored, endorsed, issued, sold or promoted by the provider of the index which a particular iShares ETF seeks to track. No index provider makes any representation regarding the advisability of investing in the iShares ETFs. Further information on the index providers can be found in the BIMAL website terms and conditions at www.blackrock.com/au.
BIMAL is the responsible entity and issuer of units in the Australian domiciled managed investment schemes referred to in this material, including the Australian domiciled iShares ETFs. Any potential investor should consider the latest product disclosure statement (PDS) before deciding whether to acquire, or continue to hold, an investment in any BlackRock fund. BlackRock has also issued a target market determination (TMD) that describes the class of consumers that comprises the target market for each BlackRock fund and matters relevant to their distribution and review. The PDS and the TMD can be obtained by contacting the BIMAL Client Services Centre on 1300 366 100. In some instances the PDS and the TMD are also available on the BIMAL website at www.blackrock.com/au. An iShares ETF is not sponsored, endorsed, issued, sold or promoted by the provider of the index which a particular iShares ETF seeks to track. No index provider makes any representation regarding the advisability of investing in the iShares ETFs. Further information on the index providers can be found in the BIMAL website terms and conditions at www.blackrock.com/au.
BIMAL, its officers, employees and agents believe that the information in this material and the sources on which it is based (which may be sourced from third parties) are correct as at the date of publication. While every care has been taken in the preparation of this material, no warranty of accuracy or reliability is given and no responsibility for the information is accepted by BIMAL, its officers, employees or agents. Except where contrary to law, BIMAL excludes all liability for this information.
Any investment is subject to investment risk, including delays on the payment of withdrawal proceeds and the loss of income or the principal invested. While any forecasts, estimates and opinions in this material are made on a reasonable basis, actual future results and operations may differ materially from the forecasts, estimates and opinions set out in this material. No guarantee as to the repayment of capital or the performance of any product or rate of return referred to in this material is made by BIMAL or any entity in the BlackRock group of companies.
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