BlackRock European Dynamic Fund

The focus of the review is on the European Dynamic Fund, but it is worth mentioning the Continental Fund as well. Giles took over the Continental Fund in 2017 and has been working on the Dynamic Fund since 2015. There is an overlap of holdings of about 70%. The two funds may differ in certain market conditions as the Dynamic Fund is a more flexible strategy and tends to have a higher turnover. The Dynamic strategy will take advantage of non-benchmark positions, for example 5% in the UK when appealing. It may also invest in unquoted securities, but this tends to be a very small weighting. The other major difference is that it may take advantage of short-term trading opportunities, for example a switch to value or short macro / sentiment driven opportunities.

BlackRock have developed a strong European team and have the largest team by assets under management and people. The approach to investing takes into account top down views but is primarily driven by bottom up stock picking. To some extent they are agnostic when it comes to style, but the fund does focus more on growth companies. They are really focused on cashflows. There are companies that will appear in index funds which they would never hold. Because interest rates are so low it allows poor companies to continue to operate. Within an index there is no choice and they believe that a good active manager has the ability to significantly outperform the index by picking good companies….read more

Fund Facts Morningstar

Notes

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