BlackRock multi-asset team turns to bond ETFs as liquidity buffer

BlackRock's Justin Christofel has been increasing his exposure to bond ETFs in order to minimise fixed income liquidity risk in the £1.2bn Global Multi-Asset Income fund.

Christofel said liquidity is one of his biggest concerns at the moment, especially within the fixed income space. "Liquidity has dramatically worsened since the financial crisis," he said. "You have to be very careful in fixed income now and adopt a more buy-and-hold attitude. "Over the past 12 to 18 months, we have been re-evaluating all our underlying [fixed income] securities and moving further up the liquidity scale." One of the ways the team is protecting against liquidity risk is by holding part of its allocation to fixed income in ETFs, especially in the high yield space whi...