BlackRock 

BlackRock launches emerging companies fund

BlackRock launches emerging companies fund

BlackRock is to launch a fund to invest in what calls "emerging UK companies".

The fund will be able to take both long and short positions, and the companies in which it invests will come from across the market cap spectrum.

BlackRock defines emerging companies as being businesses at an early stage of development.

The BlackRock UK Emerging Companies Absolute Return fund will be managed by Dan Whitestone, who runs the £523m BlackRock Throgmorton Investment Trust, which invests mostly in UK smaller companies and can take both long and short positions.

A short position means borrowing a stock now in the hope that the share price will fall and the fund manager can pocket the difference.

Mr Whitestone said: "With over 1,600 companies in the UK and over 10,000 globally, there is a wide universe within developed equity markets from which we look to find emerging companies.

"In the BlackRock UK Emerging Companies Absolute Return fund, we focus on finding businesses with long runways of growth ahead and analysing industries where change is occurring globally.

"In doing so, we look to uncover investment opportunities created by the disrupters and combine them in a portfolio which seeks to deliver positive absolute returns irrespective of market conditions."

Tom Sparke, investment director at GDIM, a discretionary fund manager, said: "This fund has an intriguing concept and with market sectors starting to diverge and returns harder to find this could be a great vehicle to add alpha in the UK.   

"I am pleased to see innovative new funds like this one entering the market and trying to add returns on a genuinely different path to traditional markets.  

"Some ‘long-short’ absolute return funds have had many successes in the UK equity space and it could be a fruitful area for those less hopeful for domestic companies’ prospects."

david.thorpe@ft.com