BlackRock has launched a new tool for advisors that aims to show how private market exposure can affect their clients’ portfolios, with the company looking to increase typical private market allocations by 5% to 20% over several years.
The tool, called an “expected return analyzer” uses the company’s Aladdin systems, with advisors uploading a portfolio of clients and selecting a goal, such as increasing return or reducing risk. The tool will then generate three suggestions on how alternative investments might help achieve the goal.
Ultimately, the BlackRock tool will offer BlackRock fund advisors who could potentially invest in the suggested asset classes.
BlackRock steps up its focus on alternatives with the underlying premise that the typical 60/40 portfolio allocation will not reduce it for investors, citing an internal study which found that the average portfolio of advisers is around 25% more volatile .
“In today’s world of low interest rates, there is a mismatch between investors’ return expectations and their exposure to private markets,” said Scott Reeder, head of alternative investments for the wealth advisory business of BlackRock in the United States, in a statement. “With volatile stock markets and bond yields near record lows, alternatives may have an increasingly important role to play as clients seek to improve returns, reduce risk and build resilience. their wallet. “
BlackRock joins the outreach team
Internally, the $ 9.5 billion asset manager added Nick Mizaur to his global public policy and external affairs team, bolstering the group he entrusted to Dalia Blass, the former management division. investments from the Securities and Exchange Commission, to lead in June.
Mizaur spent three years at BlackRock, working in the office of CEO and Chairman Larry Fink. He now works under Blass, the firm’s head of external affairs, who reports directly to Fink and oversees the global public policy group, among other teams.
Mizaur came to BlackRock after stints at Point72, the hedge fund of Steve Cohen, owner of the New York Mets of MLB. He was also a special advisor to the US Department of Commerce at the end of the Obama administration and a research analyst at Beacon Policy Advisors.
BlackRock declined to comment on Mizaur’s decision.