Posted inHead To Head, News

HEAD-TO-HEAD: Blackrock versus Church House

FSA compares two absolute return products: the Blackrock UK Absolute Alpha Fund and the SVS Church House Tenax Absolute Return Strategies Fund.
by Rupert Walker

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Conclusion

FE Fundinfo awards the Blackrock fund with three crowns, while it has graded the Church House fund with its top rating of five crowns and assigned an alpha manager rating to one of its managers, Jeremy Wharton.

The crown-rating methodology assesses a fund’s alpha, volatility and consistency of performance.

“In a sector that has been home to a number of negative headlines, both funds have been success stories by delivering for investors,” said McDermott.

“The Blackrock fund can have strong periods of outperformance due to its idiosyncratic nature, yet has been fairly consistent,” he said.

The Church House fund is more conservative in nature with a strong focus on capital preservation as its main objective. The fund is likely to outperform in the recovery phase in markets – something the product did successfully post the financial crisis in 2008, according to McDermott.

“Choosing one over the other is a toss-up depending on your views of the market,” he said.

“If you feel we are near the end of the economic cycle, then a capital preservation focused vehicle like Church House is ideal. However, if you believe the market has more mileage then the Blackrock fund is likely to enjoy greater returns,” McDermott concluded.

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