Best In Class  

Best in class: BlackRock UK Absolute Alpha

The extensive primary research carried out by BlackRock’s equity teams ensures that the majority of added value in the team's investment process comes from stock selection and the sharing of ideas is a key strength.

Mr Ridge and the UK equity team take a holistic approach to risk management using their extensive risk resources to closely monitor concentration of stocks within portfolios.

The overarching goal is for risk to be deliberate, diversified and appropriately scaled.

The team wants the stocks to complement each other so risk and tracking error are easily managed.

There is also a focus on large and medium sized companies, which tend to be easier to buy and sell.

Performance has largely met expectations with the fund producing positive returns in six of the past seven rolling-12-month periods since Mr Ridge took on the fund.

The one 12-month period it was in negative territory, it was down just 1.22 per cent.

Over five years, the fund has returned 11.2 per cent, compared with 0.9 per cent for the average fund in the sector.

The fund does carry a 20 per cent performance fee on top of its 0.93 per cent ongoing charge.

This is a very useful portfolio diversifier, with reliability and consistency at the centre of its model – these are precisely the sorts of characteristics investors yearn for in these uncertain times.

Darius McDermott is managing director of FundCalibre