Target Allocation: 2024 Gold Medal Winner(s)

Key takeaways

• Target Allocation ETF, Target Allocation ETF Tax-Aware, Target Allocation ESG ETF, and Long Horizon ETF received Morningstar gold medal ratings. Explore what makes our models unique.

All eyes are on the track (record) this year, and we’re going for the gold. Morningstar released its model portfolio medalists for 2023.

Target Allocation ETF and our marathon runner Long Horizon ETF once again held their gold ratings. Clearing extra hurdles but judged by the same gold standards, our specialty TA Tax-Aware ETF and TA ESG ETF model portfolios have joined the ranks of Morningstar Gold to give BlackRock 4 of the 8 gold ratings awarded, securing half of the spots on the podium.

A key to getting the gold has been that models are built with a US bias. Domestic stock markets have broadly outperformed international in recent history, reaffirming our conviction that the US is a business-friendly environment that can deliver strong earnings as a result.

Our methodology also benefited from competing in several events (or as some might say, stocks and bonds). Moving our balance of equity and fixed income up and down within 5% of target allows us to express our views on risk and macro. Our tendency towards an equity overweight allowed us to capture upside in bull markets but still have the flexibility to adjust during corrections.

And a good runner doesn’t slow down on the last lap. Our team has built extensive signals to look inside of each asset class. We have regularly made sector bets in stocks – if our research identifies a secular trend, or sees a swimmer ahead of the heap, we want in. We also further tune our risk by adjusting credit quality and interest rate sensitivity within our fixed income allocation.

Knowing where to host the games is important. By expressing our views in ETFs for each gold medal family, we are able to get a wide array of exposures with low costs. And don’t forget when to host: we trade when appropriate for each model’s goals but also use discretion to seize opportunities or protect against new risks.

We are honored to be recognized by Morningstar and receive two new gold medalist ratings this year in addition to our existing medals. It takes a lot to bring home the gold. We look forward to continuing training and delivering the best model portfolios we can.

This information is provided for illustrative and educational purposes only. This information does not constitute research, personalized investment advice, or a fiduciary investment recommendation from BlackRock to any client of a third party financial professional, and is intended for use only by such financial professional, in consultation with their client and with other information, as a resource to help build a portfolio or as an input in the development of investment advice for its own clients. Such financial professionals are responsible for making their own independent judgment as to how to use this information. BlackRock does not have investment discretion over, or place trade orders for, any portfolios or accounts derived from this information. Holdings, performance, and other characteristics of any portfolios or accounts derived from this information may vary materially from the information shown herein. Please review the disclosures at the end of this document for more information.

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