The BlackRock Asset Allocation Alpha Fund returned 8.17% to investors in October, continuing what has been a successful year to date, returning over 30%.
The fund which was formerly known as the Merrill Lynch Asset Allocation Alpha Fund, noted positive influences on performance included bonds/cash, currencies and equities, reflecting the long US large cap versus US small cap, and long US growth versus US value.
Looking forward, the manager noted that there is now a risk that the global economy faces deflation in the next 12 to 24 months on the heels of a severe global recession. They also noted that equity markets usually reached their lows 3 to 6 months before the end of the recession, and with their negative view in that regard, feel that it is likely to be still too early to buy.
