Posted inHead To Head

HEAD-TO-HEAD: Blackrock versus Fidelity

FSA compares two Asian fixed income products: the Blackrock GF Asian Tiger Bond Fund and the Fidelity Asian Bond Fund.
by Rupert Walker

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Introduction

Asia appears to be recovering from the Covid-19 pandemic faster than the rest of the world.

Yet, Asian government bond yields are currently yielding more than their developed market counterparts, while central bank policy rates in the region are generally higher too.

Moreover, the diversity of Asian economies suggests that Asian credit can offer global investors significant return opportunities and diversification benefits. Improving financial ratios among issuers and manageable default rates further burnish their appeal, according to the sector’s advocates.

For instance, Asian investment grade bonds offer healthy credit fundamentals and relative stability, while Asian high yield bonds provide incremental income but with historically lower volatility compared to global peers

FSA asked Isaac Poole, global chief investment officer at Oreana Portfolio Advisory, to select and compare two Asian credit products: the $4.2bn Blackrock GF Asian Tiger Bond Fund and the $2.4bn Fidelity Asian Bond Fund.

Blackrock Fidelity
Size $4.2bn $2.4bn
Inception 1996 2011
Managers Neeraj Seth, Artur Piasecki, Ronie Ganguly Eric Wong, Belinda Liao, Morgan Lau
Three-year cumulative return 11.53% 18.17%
Three-year annualised return 3.73% 5.63%
Three-year annualised alpha -0.02 0.41
Three-year annualised volatility 6.40% 6.36%
Three-year information ratio 0.14 0.53
Morningstar star rating **** ***
Morningstar analyst rating neutral bronze
FE Crown fund rating **** **
OCF (retail share class) 1.22% 1.06%
Source: FE Fundinfo, Morningstar. (Data in US dollars, 21 October 2020)

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