BlackRock plans use of corporate bond repo in new LDI fund
Holding corporate bonds would provide backup liquidity, lift returns
BlackRock is working on the launch of a new type of liability-driven investment (LDI) fund that will repo corporate bonds as an extra source of liquidity in case of a collateral crunch, according to three people familiar with the matter. Practitioners that spoke to Risk.net say it would be the first such fund they know of to hold corporate bonds.
“It’s a totally new product that [BlackRock is] bringing to market,” says one source with knowledge of the plans. The new fund will be a pooled
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