BlackRock gains $1.7B in unconstrained bond fund

Assets keep pouring in to BlackRock’s unconstrained bond fund.

The $31 billion Strategic Income Opportunities Fund had inflows of $1.7 billion in the second quarter, reports Reuters. BlackRock’s U.S. mutual funds gained $3.1 billion in inflows last quarter. For the industry, unconstrained bond funds had $1.9 billion in second quarter outflows, reports Morningstar.

Unconstrained bond funds have become hugely popular with institutional investors in the last year or so as they allow flexibility in investing to protect against interest rate sensitive assets. The BlackRock unconstrained fund has returned 0.69% this year, just below average, but has been a top performer for three and five year returns. The firm has been one of the top beneficiaries of outflows from Pimco since Bill Gross’s departure last September. Gross had run the unconstrained fund for Pimco.

BlackRock’s bond funds had a strong second quarter, drawing $4.2 billion from investors all together. Its equity funds on the other hand suffered $1 billion in outflows.

BlackRock’s earnings are due out Wednesday.

Photo: Wikipedia.