BlackRock expands Equity Income range with launch of Emerging Markets Fund

BlackRock , Inc. has launched the BlackRock Global Funds (BGF) Emerging Markets Equity Income Fund within its Luxembourg SICAV range, in response to growing demand for equity-based dividend strategies. The new fund complements the Firm’s four existing BGF equity income funds; BGF Asia Pacific Equity Income, BGF European Equity Income, BGF Global Equity Income and BGF World Resources Equity Income.

The BGF Emerging Markets Equity Income Fund is managed by Dhiren Shah, co-head of the London-based Global Emerging Markets team and seeks to generate a minimum yield 30% above the benchmark index yield. Typically the Fund will also be less volatile than the MSCI Emerging Markets Equity Index, while it also aims to outperform the MSCI Emerging Markets Equity Index over a full economic cycle. The team focuses on investing in companies which are paying above average dividends and have sustainable franchises which are expected to grow over time.

Dhiren Shah, Manager of the BGF Emerging Markets Equity Income Fund commented, “I believe that dividend investing in emerging markets represents a compelling opportunity. We continue to see stronger economic growth in emerging markets than in developed markets as developing countries benefit from lower levels of sovereign debt, better demographics with expanding workforces and growth in consumer demand. Valuations are currently below those of most developed markets equities while corporate earnings and dividend growth is stronger. It is also notable that a portfolio of income stocks with dividend yields of 2% or more would have outperformed the wider emerging market equity indices in 9 of the last 10 years.”

Alex Hoctor-Duncan, Head of Retail Sales for EMEA said, “In the current market climate income from equities is highly sought-after. The new fund addresses this requirement whilst providing access to some of the fastest growing economies across the globe. Currently, only US$ 2bn is dedicated to income investing in emerging markets. We expect assets invested in these strategies to increase substantially over the coming years, given the search for yield by investors.”