The last few years were challenged for bonds, with 2022 marking the worst year, leaving many investors spooked and under-allocated today. Take the late 2023 bond rally as an example – if you weren’t invested, you missed out.
Source: Bloomberg, as of 12/31/23. Represented by U.S. Treasury bond 10Y index annual real returns from 1929 through 2023. Past performance does not guarantee or indicate future results. Index performance is for illustrative purposes only. You cannot invest directly in the index.
SOURCE: Bloomberg; Cliffwater as of 4/25/24. Yield is represented by yield to worst, a measure of the lowest possible yield that can be received on a bond that fully operates within the terms of its contract without defaulting. High yield refers to the Bloomberg U.S. High Yield Index. Private credit refers to the Cliffwater Direct Lending Index. For more information on the Cliffwater Direct Lending Index. S. 1-3Y Treasury refers to the Bloomberg U.S. Treasury 1-3 Yr Index. U.S. 3-7Y Treasury refers to the Bloomberg U.S. Treasury 3-7Yr Index. U.S. Aggregate bond refers to the Bloomberg U.S. Aggregate Bond Index. Muni bond refers to the Bloomberg Municipal Bond Index.
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. Indices are unmanaged. You cannot invest directly in an index.
Higher rates mean ‘bonds can act like bonds’.
Investors typically buy bonds for income and diversification – but they didn’t get either over the last few years. And higher rates mean your "yield cushion" may help limit portfolio downside in multiple market scenarios.
Explore BlackRock fixed income solutions across the risk and yield spectrum for all types of investment portfolios and goals.
| Objective | Fund Name | Ticker | ETF or mutual fund | |||
| Income | ||||||
|
I want to tap into today's higher yields. |
BlackRock Flexible Income ETF > | BINC | ETF | |||
| BlackRock High Yield Bond Fund > | BHYIX | Mutual fund | ||||
| BlackRock Credit Strategies Fund > | CREDX | Mutual fund | ||||
| BlackRock Private Credit Fund > | BDEBT | ETF | ||||
| Capital preservation | ||||||
| I want to put cash to work. | BlackRock Strategic Income Opp. Fund > | BSIIX | Mutual fund | |||
| BlackRock Short Duration Bond ETF > | NEAR | ETF | ||||
| iShares Core 1-5 Year USD Bond ETF > | ISTB | ETF | ||||
| iShares Treasury Floating Rate Bond ETF > | TFLO | ETF | ||||
| Equity diversification | ||||||
|
I want bonds that diversify my stocks. |
BlackRock Global Equity Market Neutral Fund > | BDMIX | Mutual fund | |||
| BlackRock Systematic Multi-Strategy Fund > | BIMBX | Mutual fund | ||||
| iShares Core U.S. Aggregate Bond ETF > | AGG | ETF | ||||
| iShares Core Total USD Bond Market ETF > | IUSB | ETF | ||||
| Outsourcing | ||||||
|
I want to personalize and scale. |
Fixed income SMAs > | - | Other | |||
| Model portfolios > | - | ETF/Mutual fund | ||||
The funds listed in the table above have been chosen by BlackRock and iShares product strategists to help represent potential investor portfolio objectives. The scope of the funds under consideration are iShares ETF and mutual fund offerings. This information should not be relied upon by the reader as research or investment advice regarding the funds or any issuer or security in particular and is subject to change.
The strategies listed in the table above have been chosen by BlackRock and iShares product and portfolio strategists to help represent potential investor portfolio objectives. The scope of the funds under consideration are iShares and BlackRock ETF and mutual fund offerings. This information should not be relied upon by the reader as research or investment advice regarding the funds or any issuer or security in particular and is subject to change.
BlackRock’s popular, end-client approved “conversation starters” help you get the conversation rolling.
When markets are volatile, clients’ emotions can run high. Each of them need to hear from you, but there aren’t enough hours in the day for individual conversations. This is where effective scaled communications can help you build and maintain client trust without zapping all your energy.
Logically, a client’s investment decisions should be driven by numbers. But, in reality, emotions can come into play. That’s why your clients need a coach to help them stay invested through market ups and downs.
1 Source: Bloomberg; Cliffwater as of 12/29/23. Yield is represented by yield to worst, a measure of the lowest possible yield that can be received on a bond that fully operates within the terms of its contract without defaulting. U.S. 1-3Y Treasury refers to the Bloomberg U.S. Treasury 1-3 Yr Index. U.S. 3-7Y Treasury refers to the Bloomberg U.S. Treasury 3-7Yr Index. EM debt refers to the J.P. Morgan EMBI Global Core Index. U.S. Aggregate bond refers to the Bloomberg U.S. Aggregate Bond Index. Muni bond refers to the Bloomberg Municipal Bond Index. High yield refers to the Bloomberg U.S. High Yield Index. Private credit refers to the Cliffwater Direct Lending Index. Index performance is for illustrative purposes only. Index performance does not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and one cannot invest directly in an index. Past performance does not guarantee future results. Not intended for comparison . The Cliffwater Direct Lending Index (CDLI) is included within this document to demonstrate how private markets perform differently from public markets during the same time period. Note that the indices contain several differences in the way that they are calculated, including the following, and therefore may not represent a fully accurate representation of the private/public credit market. The CDLI is an asset-weighted index based on quarterly SEC filings required of BDCs, whose primary asset holdings are U.S. middle market corporate loans. SEC filing and transparency requirements eliminate common biases of survivorship and self-selection. The index returns are generally published 75 days after calendar quarter-end. The public indices are rebalanced regularly, typically monthly. The public indices are market-value weighted. The CDLI is calculated using financial statements and other filings for the eligible BDCs (so the index’s figures are based on the BDCs’ underlying holdings), thus making it unlevered and gross of fees. BDCs whose filings are the source of the CDLI are regulated by the SEC under the Investment Company Act of 1940.
2 Source: Bloomberg, as of 12/31/23. Total return historical analysis calculates average performance of the Bloomberg U.S. Aggregate Bond Index (bonds) and the Bloomberg U.S. Treasury Bills: 1-3 Months TR Index (cash) in the 6 months leading up to the last Fed rate hike, between the last rate hike and first cut, and the 6 months after the first cut. The dates used for the last rate hike of a cycle are: 2/1/1995, 3/25/1997, 5/16/2000, 6/29/2006, 12/19/2018. Dates used for the first-rate cut are: 7/6/1995, 9/29/1998, 1/3/2001, 9/18/2007, 8/1/2019. Index performance is for illustrative purposes only. Index performance does not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and one cannot invest directly in an index. Past performance does not guarantee future results.
3 Morningstar as of 12/31/23. Money market fund returns represented by the Morningstar Prime Money Market Fund Category from March 2001 to July 2002. Past performance does not guarantee or indicate future results.
4 Source: Bureau of Economic Analysis (BEA), as of 10/31/2023.
Carefully consider the Funds' investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the Funds' prospectuses or, if available, the summary prospectuses which may be obtained visiting the iShares ETF and BlackRock Mutual Fund prospectus pages. Read the prospectus carefully before investing.
Investing involves risk, including possible loss of principal.
Transactions in shares of ETFs may result in brokerage commissions and will generate tax consequences. All regulated investment companies are obliged to distribute portfolio gains to shareholders.
Fixed income risks include interest-rate and credit risk. Typically, when interest rates rise, there is a corresponding decline in bond values. Credit risk refers to the possibility that the bond issuer will not be able to make principal and interest payments.
An investment in fixed income funds is not equivalent to and involves risks not associated with an investment in cash.
Money market funds typically seek to maintain a net asset value of $1.00 per share. Fixed income funds do not have a similar objective. You could lose money by investing in the Fund. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The Fund may impose a fee upon sale of your shares or may temporarily suspend your ability to sell shares if the Fund's liquidity falls below required minimums because of market conditions or other factors. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The Fund's sponsor has no legal obligation to provide financial support to the Fund, and you should not expect that the sponsor will provide financial support to the Fund at any time.
International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation and the possibility of substantial volatility due to adverse political, economic or other developments. These risks often are heightened for investments in emerging/ developing markets or in concentrations of single countries.
No proprietary technology or asset allocation model is a guarantee against loss of principal. There can be no assurance that an investment strategy based on the tools will be successful.
Any indexes referenced herein are used under license by BlackRock and/or Aperio. Indexes represent unmanaged groups of securities. Investing directly in an index is not possible. Reference to an index does not imply that the portfolio would achieve returns, volatility, or other results similar to that index. Further, an index’s composition may not reflect the manner in which a client portfolio is constructed in relation to expected or achieved returns, investment holdings, portfolio guidelines, restrictions, sectors, correlations, concentrations, volatility, or tracking error targets, all of which are subject to change over time. Any index referenced would necessarily be materially different in strategy and volatility from the client account.
The S&P 500® Index is an equity benchmark for US stock performance. It is a capitalization-weighted index covering 500 large US companies chosen by Standard & Poor’s for market size, liquidity, and industry group representation. The S&P 500® index is a product of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”) and has been licensed for use by Aperio. Standard & Poor’s® and S&P® are registered trademarks of Standard & Poor’s Financial Services, LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by Aperio. No Aperio strategy or product is sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, or their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) or strategies, nor do they have any liability for any errors, omissions, or interruptions of any index.
The MSCI EAFE® Index is an equity benchmark for international developed-markets performance. It is a capitalization-weighted index covering large and midsize companies. The index includes approximately 900 stocks from 21 developed-market countries, excluding the US and Canada. The MSCI Indexes referenced herein are the registered trademark of MSCI or its subsidiaries in the United States and other jurisdictions. The indexes are used by Aperio under license from MSCI. The strategy referenced herein is not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such strategies, or any MSCI index upon which such strategies are based. Aperio’s license agreement with MSCI contains a more detailed description of the limited relationship MSCI has with Aperio and any related strategies. No further distribution of data from any MSCI index is permitted without the MSCI’s express written consent.
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. Investors should consult their tax or legal advisor regarding such matters.
This information should not be relied upon as research, investment advice, or a recommendation regarding any products, strategies, or any security in particular. This material is strictly for illustrative, educational, or informational purposes and is subject to change.
The BlackRock and iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, "BlackRock").
The iShares Minimum Volatility Funds may experience more than minimum volatility as there is no guarantee that the underlying index's strategy of seeking to lower volatility will be successful.
For more information on the differences between ETFs and mutual funds, click here.
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