BLACKROCK UK ABSOLUTE ALPHA D

  • 153.80p Price (Inc)
  • - Price (Acc)
  • 0.00% 0.00%

    Initial charge
  • 0.75% Annual management charge
  • 0.92% Ongoing charges
  • 0.20% Yield

Prices as at 04 September 2019 , fund data last updated 15 November 2019

The fund targets positive returns in all market conditions through investment primarily in FTSE 100 and FTSE 250 UK equities. To achieve the objective manager Nigel Ridge takes traditional long positions in stocks he expect to rise in value, as well as short (negative) positions in stocks he expects to underperform. The fund’s overall market exposure is kept low, typically between -10% to +30%, whilst gross exposure will not be more than 150%. Typical fund volatility is 5-7%, with the aim of generating returns of 4-5% p.a. over a 2-3 year period.

Fund summary

Sector Targeted Absolute Return
Structure UNIT TRUST
Launched
Size £254m
Yield 0.20%
Charging basis Income
Dividends paid Acc units only

Charges

Initial charge 0.00%
Initial charge via Bestinvest 0.00%
Annual management charge 0.75%
Ongoing charges figure 0.92%

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Investment process

The fund’s investment universe is primarily FTSE 350 stocks, though some small-caps may also feature. Since the current manager took over in 2013, the fund's typical gross exposure has been raised to enable him to strike towards the performance target; small cap exposure has also been de-emphasised; potential net portfolio exposures are unchanged. Positions are primarily held via Contracts for Difference (CFDs) rather than directly in the equities. As well as naked long and naked short positions, the portfolio will also include pair trades. Index futures may be used to regulate overall market exposure. The manager applies a pragmatic approach to stock selection, combining macroeconomics with fundamental stockpicking. He identifies changes to growth rate, risk profile and investor perspective and uses proprietary spreadsheets to aid analysis. The aim is to identify a catalyst that might unlock value (or destroy value in the case of a short holding). The manager pays careful attention to managing style / factor risks across the portfolio.

This was one of the first targeted absolute return funds made available to UK retail investors when it launched in 2005. After a strong start returns fell away, but since Nigel Ridge too control in 2013 he has given the fund a new lease of life. Ridge had already achieved strong returns on an offshore hedge fund with a similar mandate, and has modified the UK Absolute Alpha fund to reflect the market environment and his analytical strengths. Ridge benefits from the support of a strong UK equity team at BlackRock including two dedicated absolute return analysts.

Manager research

Average monthly relative returns

Bestinvest MRI

14/15 15/16 16/17 17/18 18/19 3 years 5 years Career 3 years 5 years Career
0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Track record

Periods of worst performance

Absolute 0.00% ()
Relative 0.00% ()

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

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Sector breakdown

Financials 15.00%
Oil & Gas 5.00%
Consumer Services 4.00%
Industrials 3.00%
Consumer Goods 3.00%

Portfolio

70-90 positions - typically 30 long, 30 short and 20 pairs.

Key Investor Documents

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