BlackRock Advantage Australian Equity Fund

About this Fund

Fund Detail

PDS https://informedinvestor.com.au/view/pds/100516-2023-10-26-02:19.pdf
FUND MANAGER BlackRock Investment Management (Australia)
ASX Code

The Fund’s investment strategy aims to remain fully exposed to the Australian stock market, with cash exposure being maintained to a minimum, which may be, where practicable, equitised using index futures.


The Fund aims to outperform the Benchmark by 2.20% before fees over rolling three-year periods, while maintaining a similar level of risk.

BENCHMARK S&P/ASX 300 Accumulation Index
FUND SIZE S&P/ASX 300 Accumulation Index
FEES 0.45% p.a.



Benefits of investing in the BlackRock Advantage Australian Equity Fund

BlackRock Expertise

The portfolio of stocks to which the Fund is exposed is managed by BlackRock's Systematic Active Equity team.

The team consists of highly qualified and experienced portfolio managers, strategists and researchers located in the United States, Europe and Asia Pacific.


In contrast to a direct investment in a single company, the Fund provides broad exposure to the Australian stock market.

Proven Track Record

The Systematic Active Equity team uses a proven, risk-controlled systematic process that is constantly being improved, to maximise its potential to deliver competitive returns to investors.





Should be considered by investors who

  • Seek broad exposure to the Australian equity market.
  • Seek a fund that uses a proven, risk-controlled scientific process, to maximise its potential to deliver competitive returns to investors.
  • Have a long term investment horizon.



Key Features

About the Fund

The Fund aims to achieve superior investment performance through providing returns that exceed those of the S&P/ASX 300 Total Return Index (Benchmark) by 2.20% p.a., after fees, over rolling 3-year periods, while maintaining a similar level of investment risk to the Benchmark.

Our investment style is based on our belief that people, leveraged by technology, are central to the consistent achievement of our clients' investment goals.

A single, global investment philosophy unites all BlackRock systematic (quantitative) investment strategies. Knowledgeable investment people leveraging their skills through the extensive use of technology is a hallmark of our systematic investment approach.

We believe that a focus on total performance management is the best way to achieve superior investment results. Through total performance management, we aim to understand; measure; forecast; and manage the three dimensions of investment performance — return, risk and cost.

Our active Australian equity strategy is designed to be highly diversified, providing broad exposure to the Australian equity market. Rather than making large and inherently risky investments in a few individual stocks, smaller investments are made across many individual stocks. This process diversifies active risk across a broad spectrum of stocks in a variety of industries and is designed to provide more consistent active returns over time. Investment decisions are made through a disciplined investment process which we refer to as the "alpha tilts process. This process makes decisions by utilising information derived from:

  1. Earnings Direction: Changes to earnings forecasts affect stock prices. By monitoring changes to expected earnings we are able to add value by exploiting the reactions of market participants to these changes in earnings expectations;
  2. Relative Valuation: This family of signals uses valuation models to assess each company's intrinsic value relative to its current market value and to other similar companies from the same sector;
  3. Timing Insights: By analysing market data, we are able to identify the dominance of specific investment styles, such as growth and value, at certain points in the investment cycle.
  4. Earnings Quality: These signals assess the quality and sustainability of company earnings based on company financial data such as balance sheet and income statement information; and
  5. Market insights: This uses market-based information such as share price behaviour to forecast expected medium-term company performance.

In addition to these five insight sources, we seek to add further value by taking advantage of specific events, such as changes to the Benchmark, mergers and acquisitions, initial public offerings and dividend reinvestment programs.


How we invest your money

Investments are made in stocks that form the Benchmark but not necessarily in the same proportions as the Benchmark. Our investment process may determine that it is preferable to be overweight in companies which:

  • have improving return expectations;
  • appear undervalued relative to companies in the same sector;
  • have an investment style currently in favour;
  • have high quality and sustainable earnings; or
  • are favoured by informed market participants.

Conversely, our investment process may tilt away from those companies that have neutral to negative outlooks on many of these factors.

Our active Australian equity strategy is designed to avoid uncompensated active risks. When compared with the Benchmark, the Fund may be moderately exposed to industries and sectors, as well as in style and size.

The Fund will not invest in companies that have significant business activities involving tobacco and those engaged in the production of controversial weapons and nuclear weapons.

To achieve its investment objective the Fund invests substantially all of its assets in the BlackRock Australian Alpha Tilts Fund (Underlying Fund), another fund managed by us which has the same investment strategy as the Fund. The Underlying Fund invests in the Australian stocks that form the Benchmark. Derivatives, such as futures, forwards and options can be used to manage risk and return. When derivative positions are established, they will always be backed by cash holdings and/or underlying assets. Derivative securities will not be used to gear the Underlying Fund.

The Fund and Underlying Fund may also hold a small allocation of cash (or cash equivalents that may include units in other BlackRock funds) for cash flow management purposes.

The Fund's investment strategy aims to remain fully exposed to the Australian stock market, with cash exposure being maintained to a minimum, which may be, where practicable, equitised using index futures.