BlackRock thinktanks on investment trusts

BlackRock is to increase its focus on investment trusts and is lining up a nationwide series of thinktank sessions for IFAs.

The world’s biggest asset manager is gauging the opinions of around 50 IFAs by holding five or six sessions on the funds, with an eye to possibly adding to its existing range of six trusts.

Investment trusts do not pay commission and interest has waned over the past decade, with assets falling from £63.9 billion in 2000 to £63.3 billion this year. However, interest is expected to rise after the retail distribution review (RDR) deadline when undisclosed commission will be banned and advisers are forced to abide by a wider definition of independence.

Tony Stenning, the head of UK retail at BlackRock, says: “We are very cognisant that we have hitherto focused too much on the open-ended side.
(article continues below)

“Closed-ended funds have no distribution fee in the annual management charge, you can leverage them if you want and they are less expensive than the typical open-ended vehicle so you have got lots of benefits.”

He says BlackRock also wants to raise awareness to drive down discounts on the market-listed funds, where share prices on the funds trade at below their net asset values.

Stenning adds: “The downside is discounts because they can widen. What you find with certainly a huge swathe of the industry is that you get some huge liquid vehicles that still trade at a huge discount this is incongruous.”