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BlackRock creates discounted strategic units on core funds

BlackRock creates discounted strategic units on core funds

BlackRock has launched discounted ‘strategic unit’ classes on four of its core UK funds.

The share classes have been issued on Nick Little’s £897 million BlackRock UK fund and Simon Blundell and Ben Edwards’ £284 million BlackRock Corporate Bond, along with two multi-asset funds headed by Andy Warwick – the £203 million BlackRock Balanced Growth Portfolio and the £97.4 million Balanced Income Portfolio.

The strategic unit classes will levy an annual management charge (AMC) of 0.67% on the UK and multi-asset funds versus the standard institutional AMC of 0.75%, while the AMC on the Corporate Bond fund reduces from 0.5% to 0.45%.

BlackRock said it would make the new classes available to ‘selected’ distribution partners. 

The firm explained it had launched the units to offer greater transparency in charging structures following the introduction of the retail distribution review.

It chose the four funds as they represent typical areas a UK investor targets when building a well-diversified portfolio of corporate bonds and equities. This is complemented by the rise in multi-asset strategies on the back of demand for outcome-oriented solutions.

BlackRock head of UK retail Tony Stenning said: ‘Our recent research from the BlackRock Global Investor Pulse survey tells us that investors want greater transparency in charging structures when making their investment decisions and BlackRock is pleased to play a part in this key industry evolution.’

The news comes as the fund price war intensifies.

On 25 March Standard Life revealed the 290 funds it had struck ‘super clean’ pricing deals with on its platform, while Hargreaves Lansdown revealed the 27 funds on its discounted Wealth 150 + list earlier in the month.

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Nick Little
Nick Little
141/153 in Equity - UK (All Companies) (Performance over 3 years) Average Total Return: 38.87%
Simon Blundell
Simon Blundell
21/59 in Bonds - Sterling Corporate Bond (Performance over 3 years) Average Total Return: 31.10%
Ben Edwards
Ben Edwards
39/76 in Bonds - Sterling Corporate Bond (Performance over 1 year) Average Total Return: 7.30%
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