Posted inHead To Head, News, Research

HEAD-TO-HEAD: Blackrock vs Bluebay

FSA compares two euro corporate bond funds: the Blackrock GF Euro Corporate Bond Fund and the Bluebay Investment Grade Bond Fund.
by Fund Selector Asia
Conclusion

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The Blackrock fund has a four-star Morningstar rating and an analyst rating of Silver. The Bluebay fund carries three-stars and a Bronze.

Morningstar’s star rating looks at historical risk-adjusted performance and the analyst rating is forward-looking analysis.

While Dash would not comment on whether he prefers one fund over the other, he pointed out that volatility is the major differentiating factor investors should look at. As mentioned earlier, the Bluebay fund is the more volatile of the two.

Dash said that the returns delivered by the Blackrock fund have been comparatively stable because of a more diversified approach. It would therefore appeal to more risk-averse investors aiming for steady returns.

By comparison, Bluebay’s fund invests in subordinated financial debt and derivatives, which makes the portfolio more credit-sensitive, complex and higher in gearing. The higher risk of the fund could lead to higher returns, compared to Blackrock’s product. It would therefore be the more suitable of the two for investors with a risk appetite seeking higher returns.

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