Fund Rationale: BlackRock BGF World Real Estate Securities Fund

BlackRock BGF World Real Estate Securities Fund (the "Fund")
SGD Hedged Class A6 Distribution Shares (ISIN: LU2190626643)
Fund Manager Page
Daily Price & Charts

Endowus has selected the Fund as it offers:

  • Stable & experienced portfolio management team with an average of 28 years of industry experience, supported by a sizeable analyst team compared to peers;
  • Structured & methodical investment process that is valuation-driven and enables real-time identification of mispricing opportunities;
  • Good performance against its benchmark and peers; and
  • Retail share class with 100% trailer fee rebated back to Endowus to achieve lower cost of access.

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Key Information

Fund Objective: The Fund aims to maximise return through a combination of capital growth and income, by investing primarily in the shares of companies globally the main business of which is real estate.

Suitability: Investors who seek to maximise total return, seek to invest in equity securities of companies whose predominant economic activity is in the real estate sector, and are informed investors willing to adopt capital and income risk.

Cost:
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  1. Total Fund-level Fees include fund management fee of 1.50%.
  2. This is a retail share class with 100% trailer fee rebated back to Endowus investors to lower the cost of access.
  3. Endowus do not charge a preliminary sales charge or any other additional fees, other than the all-in Endowus Access Fee.

Fund Characteristics

Fund Inception: 25 February 2013
Share Class Inception: 24 June 2020
Benchmark: FTSE EPRA/NAREIT Developed Index

Fund AUM: SGD 249m
Source: MorningStar as of 24 June 2021. Please refer to the FMC page for the most updated AUM.

Regional Allocation:
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Sector Allocation:
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Source: MorningStar as of 28 February 2021. Allocation data indicate actual exposure as a percentage of the Fund's total Net Asset Value. Please refer to the Fund Manager Page for the most updated information on Fund Holdings and Breakdown.

Selection Criteria

Endowus has selected the BlackRock BGF World Real Estate Securities Fund because it is managed by a stable and experienced team. Senior portfolio managers Mark Howard Johnson, Alastair Gillepse, and James Wilkson built up the BlackRock’s real estate team and have been with the strategy since its very early days in 2013. The portfolio managers have on average 28 years of industry experience; they each cover one region (US, Europe, and Asia Pacific) together with the analysts on the team. The analyst team is relatively sizeable compared to the fund’s peers, providing in-depth fundamental research on the securities they cover. In addition, the division of responsibility and the communication line is clear and streamlined.

The investment process is structured and methodical. The team employs the same real estate security selection framework and valuation methodology, which is then fed into the Relative Value Matrix. The Relative Value Matrix compares the intrinsic valuation of each security to market price and against peers and thus aims to identify mispricing opportunities in real time. Risk analysis and oversight is a deliberate step in the investment process and there is a dedicated risk team and system (Aladdin) to help identify portfolio-level risks.

The majority of the Fund’s allocation would be to REITs companies, with the remaining in non-REITS names like property developers. The split is typically 75% in REITs and 25% in non-REITS. The Fund has performed well compared to the benchmark and its peers.

The A6H share class of the Fund is hedged to Singapore Dollars and targets to pay a stable monthly distribution subject to regular review. Investors can refer to the latest monthly distribution yield on this strategy to gauge forward-looking yield level.

This Fund is interesting for investors who may typically only focus on the local REITs market as the Fund will help broaden exposure instead of solely having a home bias in real estate. Nonetheless, investors should note that investing solely in the property market involves taking on concentrated sectoral risk. Therefore when selecting the Fund, you should consider diversifying your portfolio with allocations to other sectors and asset classes.

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Updated by Endowus: June 2021

** Disclaimer: Past performance should not be taken as an indication or guarantee of future performance and no representation or warranty, express or implied, is made regarding future performance. Any opinions expressed reflect a judgment at the original date of publication by us and are subject to change without notice.
The prospectus, profile statement, product highlight sheet, fund factsheet or other offer or product documents may contain references about the expected risk tolerance of their target investors. These are in no way indicative of how we at Endowus have assessed your risk tolerance based on your stated objectives and financial situation. Endowus accepts no responsibility for investment decisions made in response to the expected risk tolerance levels mentioned in the product or offer documents.