Results analysis from Kepler Trust Intelligence

RNS Number : 1911J

BlackRock Frontiers Investment Tst

18 December 2020

 

BlackRock Frontiers (BRFI)

18/12/2020

Results analysis from Kepler Trust Intelligence

· BlackRock Frontiers released its final results for the year ending 30 September 2020 last week, showing a decline in its NAV of 20%, relative to a fall of 15% from the benchmark - a bespoke index which tracks the emerging and frontier markets excluding the largest eight.

· However, since the financial year end the trust has seen a sharp rise in absolute and relative performance as news of a COVID vaccine has lifted spirits, delivering NAV returns of 27.9% compared with a rise in the benchmark of 15.5% between the financial year end and 11 December 2020.

· Having traded on a consistent premium for most of its recent life the trust started 2020 on a premium of 7.2%, but by its financial year end in September had moved to a discount of -4.9%. Although the discount has narrowed slightly since, it could still be a potentially attractive entry point for those seeking exposure to this highly differentiated strategy, with its unique focus on 'truly emerging' markets .

Kepler View

The dramatic snap-back in the performance of BlackRock Frontiers since the news of a breakthrough on a vaccine for Coronavirus began to filter through underlines what could be an interesting entry point for investors seeking exposure to emerging markets, and puts the trust back on the front foot after a difficult year.

The current discount (-1.5%) - even though it has tightened in recent weeks - may well prove attractive as a potential entry point for some investors - given that for most of the last five years BRFI has traded on a premium to NAV.

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