Index funds are a small category of mutual funds designed to provide broader market exposure, manageable risk, low operating costs, and a relatively lower portfolio turnover.
Index funds follow certain predetermined trading rules and it’s often easier to track underlying investments for future strategy.
The Blackrock Equity Index Fund is one of the most popular index funds. In this post, we will be focusing on it, giving you all the information you need to leverage all the benefits it has to offer.
Blackrock Equity Index Fund: Portfolio Overview
The Blackrock Equity Index Fund is an exclusively US-based index fund and as such, most of the investments in its portfolio are US-based. According to recent data, US stocks account for nearly 98.5% of the total portfolio value.
Non-US stocks, on the other hand, account for roughly 0.9%. However, there are several other assets too. While stocks remain the biggest assets in the portfolio, the Blackrock Equity Index Fund invests in bonds, cash and other assets. However, they account for a very small percentage of the portfolio.
There is also a clear focus on technology. Six out of the top ten holdings by the Blackrock Equity Index Fund are all technology companies including major ones such as Apple, Alphabet, Amazon, and Microsoft. The fund also has interests in non-tech stocks.
Major companies like Exxon Mobil, the Berkshire Hathaway, Johnson and Johnson, and JP Morgan Chase are part of the portfolio. These are the top ten assets under Blackrock’s portfolio. There are several other investments too but they are relatively small.
Blackrock Equity Index Fund Stats
The Blackrock Equity Index Fund at the moment has slightly over $4 billion in assets under management. The average annual turnover ratio remains steady at 5.49% while total annual operating expenses stand at 0.02 % of total asset value under management.
To date, Blackrock Equity Index Fund’s best three-month return stands at 25.90% while the worst three-month return currently stands at -29.55%.
Investment Strategy, Objectives, and Fund Structure
In a nutshell, the Blackrock Equity Index Fund is an asset management company that seeks capital appreciation and dividends through investments of equity securities and other financial assets.
The fund raises money through the New York Stock Exchange and other notable sources. The fund is categorized as a collective investment trust and is fully managed by the BlackRock Institutional Trust Company.
While the fund’s main focus is in equity securities in the United States, it may on some occasions seek additional promising opportunities either outside the US or in different financial assets.
Principal Risk for Investors
Principal risk is anything that may substantially affect the performance of the fund and its overall net asset value over a set period of time. Blackrock Equity Index Fund’s operating risks vary but we have tried to capture some of the most notable ones.
First of all, while the fund and its managers will do everything possible to forecast market movements based on currently available data, there is no guarantee that investment outcomes will always be satisfying for both asset managers and investors alike.
Additionally, the price of equity securities may fluctuate significantly based on factors that are beyond Blackrock’s control. For example, profit warnings and changing regulations in underlying companies may significantly affect the value of securities associated with such companies.
Before Investing with Blackrock Equity Index Fund
In case the Blackrock Equity Index Fund looks like a solid investable opportunity, there are several things you need to do before putting your money there. First, gather as much info as you can about the fund including all disclosure documents and fees.
Minimum investment and maximum investment limits also need to be on your fingertips. It will also be a good idea to look at the average annual net investment income and net investment value.
Blackrock Equity Index Fund is one of the major index funds in the United States with over $4 billion in managed assets. The fund has built a reputation for ethical corporate governance and a consistent rate of positive average annual turnover.
It’s something worth looking at, especially for investors seeking yields in US-based equity securities. The fund is available in the NYSE as well.