In our Best of Funds Family series, we are focusing today on funds from BlackRock, one of the world’s premier asset management firms which manages over $3.35 trillion in assets and is a provider of investment management and advisory services around the world. We are spotlighting five funds here: a fixed income fund (Corporate High Yield), an equities fund (small-cap equity focused), a balanced asset allocation fund and two sector funds (Energy & Resources and Utilities & Telecom).
BlackRock High Income A (MDHIX) seeks to generate a high level of income while adhering to its investment policies. It has a secondary objective of capital growth and was incepted in October 1994.
At least 80% of the fund’s assets are invested in fixed-income securities which are not highly rated by prominent rating agencies such as Moody’s Standard & Poors or Fitch. It also invests in unrated securities of comparable quality. The fund may invest in fixed-income securities with differing maturity periods.
The fund has an expense ratio of 0.93% against a category average of 1.20%. It has an annual holdings turnover of 72% compared to a category average of 90%. The fund’s top holdings include Newpage 144A 11.375%, Clear Channel Worldwide Holdings Inc and Engy Future Hldgs 11.25%. The Fund underperformed its benchmark the Barclays Capital US Corporate for the 1-year period ended September 30, 2009.
James Keenan has been lead manager of this fund since April 2007. Keenan is a Chartered Financial Analyst and is a director and portfolio manager with BlackRock.
BlackRock Small Cap Growth Equity A (CSGEX) was incepted in September 1993. The fund seeks long-term growth.
The fund invests in companies which are expected to grow significantly due to their distinctive competencies in products, technologies, management, markets and opportunities. This growth is expected to be greater than the economy’s rate of expansion and the inflation rate. At least 80% of its assets are used to purchase equity in small-cap companies with market capitalizations comparable to companies in the Russell 2000 Growth index. It invests in common and preferred stock and convertible securities and may also consider IPOs.
This fund has an expense ratio of 1.19% against a category average of 1.61%. As of September 2009, it has a portfolio turnover of 81% compared to a category average of 133%. The fund’s top holdings include Tivo Inc, SkillSoft ADR and ExlService Holdings Inc. For the 1-year period ended September 30, 2009 the fund underperformed its benchmark Russell 2000 Growth Index.
Andrew F. Thut has been lead manager of this fund since March 2004. Before joining BlackRock in 2002, Thut was an equity analyst with MFS Investment Management.
BlackRock Global Allocation A (MDLOX) seeks total return. It was incepted in October 1994.
Domestic and foreign equities, debt securities, and money market instruments constitute the majority of the fund’s investments. The portfolio is adjusted with respect to types of securities and markets according to prevalent market and economic trends. The fund focuses on securities of issuers located in North and South America, Europe, Australia and the Far East.
The fund has an expense ratio of 1.22% against a category average of 1.19%. As of July 2009, it has a portfolio turnover of 32% compared to a category average of 101%. The fund’s top holdings include SPDR Gold Shares, Petroleo Brasileiro SA and Microsoft Corporation. For the 1-year period ended October 31, 2009, the fund outperformed the S&P 500 Index, FTSE World Index and Citigroup World Government Bond Index, but underperformed the broad-based all-equity benchmark, the FTSE World Index.
Dennis W. Stattman has been lead manager of this fund since February 1989. Stattman is a Chartered Financial Analyst and heads the BlackRock Global Allocation team.
BlackRock Energy & Resources A (SSGRX) seeks to provide long-term capital appreciation. It was incepted in March 1990.
The majority of the fund’s resources is invested in global energy and natural resources companies and associated businesses, including utilities. It purchases securities of companies located worldwide and normally invests in at least three countries. It focuses on developed markets, but may also invest in emerging markets. The fund is nondiversified.
The fund has an expense ratio of 1.27% against a category average of 1.72%. It has an annual holdings turnover of 32% against a category average of 104%. The fund’s top holdings include Massey Energy Company, Southwestern Energy Company and Consol Energy Inc. The fund underperformed the broad-market S&P 500 Index and the Lipper Natural Resources Funds Index, its sector benchmark, for the six-month period ended March 31, 2009.
Daniel J. Rice, III has been lead manager of this fund since March 1990. Before his current assignment, he was a senior vice president of the State Street Research Global Resources Fund.
BlackRock Utilities & Telecom A (MDGUX) seeks both capital appreciation and current income. It was incepted in October 1994.
At least 80% of the fund’s assets are invested in by domestic and foreign utilities and telecommunications companies. It invests in both equity securities and fixed-income securities, which are generally those rated investment-grade. The fund may invest in companies located in both developed and emerging markets.
The fund has an expense ratio of 1.37% against a category average of 1.39%. As of October 2009, it has a portfolio turnover of 30% compared to a category average of 100%. The fund’s top holdings include FPL Group, AT&T Inc and Verizon Communications Inc. For the 1-year period ended July 31, 2009, the fund underperformed its composite benchmark, comprised of 70% S&P 500 Utilities Index and 30% S&P 500 Telecommunication Services Index.
Kathleen Anderson has been lead manager of this fund since December 2002. Anderson has been with BlackRock since 1993.
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