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David Kimberley
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Updated 10 Nov 2023
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This is not substantive investment research or a research recommendation, as it does not constitute substantive research or analysis. This material should be considered as general market commentary.

Five managers from BlackRock gave lunchtime webinars to Kepler Trust Intelligence readers earlier this month. A range of sectors were on display from BlackRock World Mining (BRWM) to the regional BlackRock Latin America (BRLA).

The latter presentation was given by deputy portfolio manager Chris Brinkmann, who took up his role after the departure of manager Ed Kuczma in September of last year. Chris noted that LATAM is looking increasingly attractive to investors for several reasons.

After a decade in which investment has been sucked away to other parts of the world by lower rates, LATAM countries largely offer positive interest rates. Indeed countries such as Brazil and Chile were quick to hike rates and are now starting to cut them.

LATAM is also benefiting from higher commodity prices and many countries in the region are acting as neutral partners to countries in an increasingly fissured world. Mexico, for example, has seen its imports from China rise and exports to the US increase.

BlackRock Frontiers (BRFI) managers Emily Fletcher and Sudaif Niaz told a similar story, noting that many of the countries they invest in are also benefitting from companies looking to mitigate some of the risks that exist within current trade routes.

However, they also noted that, despite strong performance over the past couple of years, the trust’s investment universe remains under researched and untapped by investors globally. That fits with one piece of research we detailed in one of our guides, which showed that, although they constituted 15% of global GDP in 2022, frontier markets constituted 0.3% of global market cap.

BRWM is also taking advantage of some related trends, namely the sudden rush that we’ve seen for commodities so that companies and governments can make the transition to a fossil fuel free world. Manager Evy Hambro also highlighted an interesting gap between the gold buying activity of central banks compared to retail investors, who have been selling off.

Also insightful was BlackRock Greater Europe (BRGE) manager Stefen Gries. Investors in Europe have had to contend with an extremely tough couple of years, with the combination of inflation and the war in Ukraine creating negative sentiment for companies listed on the continent.

Things have improved over the past 12 months and the sell offs have arguably created some interesting opportunities. Stefan highlighted some key areas that the trust is invested in at the moment, namely healthcare, luxury goods, and semiconductors. It was a simple reminder that there are plenty of world-leading companies listed in Europe, even if there is a tendency among investors to believe that these only exist in the US and East Asia.

The other presentation was BlackRock Sustainable American Income (BRSA). As the name suggests, the trust invests with a strong ESG mandate. This is an area that, you may be surprised to learn, can attract some scepticism. However, BlackRock strategist and presenter Steve Farkas provided some useful comparisons of returns, illustrating that this focus has helped deliver outperformance in the past.

Another area that readers may find interesting were some of the more macro-driven views that Steve elaborated upon towards the end of the presentation, particularly around a recession and the stock specific opportunities that may present for managers.

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