BlackRock
www.blackrock.com
AGEST and BlackRock
AGEST employs BlackRock to manage a small portion of the fund's assets using an "absolute return strategy". We have invested in the BlackRock ARS (Pension) III Fund (hereinafter referred to as the "BlackRock ARS fund"). Note that this used to be called the Quellos fund - BlackRock and Quellos merged in October 2007, with management of the fund in which invest being unchanged.
Objective and strategy
The objective of an absolute return strategy is to generate consistent, positive returns each year with a low volatility of returns. The investments are usually structured to produce low correlation to equity and fixed interest markets.
The BlackRock ARS fund is a "fund of funds" which means that it invests in a wide range of different investment managers who use different investment strategies to make money. By combining many managers and investment strategies into the one fund, the BlackRock ARS fund has a low chance of a negative return in any year.
The specific objective of the BlackRock ARS fund is to generate total returns in excess of the yields on short-term US Treasury securities, irrespective of the performance of any particular sector of the global capital markets.
The fund seeks to achieve its objective by capitalising on inefficiences in the global capital markets through an allocation of the fund's capital to multiple external investment managers who pursue a variety of absolute return strategies.
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