MAPCX
BlackRock Sustain Emg Mkts Equity-Inst
Strategic Focus on Asian Markets
The BlackRock Sustain Emg Mkts Equity-Inst (MAPCX) is strategically designed to capture the growth potential of Asian markets, excluding Japan. This fund invests at least 80% of its net assets in equity securities of companies that are either located in Asia or derive the majority of their economic activity from the region. This focus allows investors to tap into the dynamic and rapidly growing economies of Asia, which are often characterized by higher growth rates compared to developed markets. The fund’s emphasis on sustainability further enhances its appeal, as it seeks to invest in companies that are not only financially robust but also committed to sustainable practices. This dual focus on growth and sustainability positions MAPCX as a compelling choice for investors looking to benefit from the economic expansion in Asia while supporting environmentally and socially responsible business practices.
At A Glance
Executive Summary
MAPCX offers sustainable exposure to Asian equities, excluding Japan, with a competitive expense ratio of 0.86% and a focus on long-term growth.
Exposure to high-growth Asian markets excluding Japan. Focus on sustainable investments. Managed by BlackRock, a leading asset manager.
Higher volatility with a beta of 1.18. Negative alpha indicating underperformance. Limited exposure to non-Asian emerging markets.
Performance Analysis and Benchmark Comparison
When evaluating the performance of MAPCX, it is essential to consider its benchmark, the MSCI ACWI xUS DivAdj Idx (A-XUS). Over the past year, MAPCX has delivered a return of 10.95%, which, while positive, falls short of the benchmark’s 17.25% return. This underperformance is reflected in the fund’s negative alpha of -6.32%, indicating that it has not added value relative to its benchmark. The fund’s beta of 1.18 suggests higher volatility compared to the benchmark, which has a beta of 0.58. Despite these challenges, the fund’s focus on sustainable investments and its strategic allocation in high-growth sectors like technology and financials may offer long-term growth potential. Investors should weigh these factors against the fund’s recent performance when considering MAPCX for their portfolios.
Sector Allocation and Growth Potential
MAPCX’s sector allocation is heavily weighted towards technology and financials, which together comprise over 57% of the fund’s portfolio. This strategic allocation reflects the fund’s focus on sectors that are pivotal to the economic growth of emerging markets in Asia. The technology sector, accounting for 30.23% of the portfolio, is particularly noteworthy given the rapid digital transformation and innovation occurring in the region. Financials, at 27.44%, play a crucial role in supporting economic development through banking and financial services. This sectoral focus aligns with the fund’s objective of maximizing total return by investing in high-growth industries. However, investors should be mindful of the potential risks associated with such concentrated exposure, particularly in volatile market conditions.
Risk Metrics and Volatility Considerations
Investors considering MAPCX should be aware of its risk metrics, which indicate a higher level of volatility. The fund’s beta of 1.18 suggests that it is more volatile than its benchmark, the MSCI ACWI xUS DivAdj Idx (A-XUS). Additionally, the fund’s Sharpe Ratio of -0.41 and Treynor Ratio of -5.36 highlight the challenges it faces in delivering risk-adjusted returns. The standard deviation of 4.45% further underscores the fund’s volatility. Despite these risk factors, the fund’s focus on sustainable investments and its strategic allocation in high-growth sectors may offer potential rewards for investors with a higher risk tolerance. It is crucial for investors to assess their risk appetite and investment horizon when considering MAPCX as part of their portfolio.
Top Holdings and Market Cap Distribution
The top holdings of MAPCX provide insight into the fund’s investment strategy and market cap distribution. Taiwan Semiconductor Manufacturing Co Ltd is the largest holding, comprising 11.21% of the portfolio, reflecting the fund’s emphasis on leading technology companies. Other significant holdings include Naspers Ltd Class N, SK Hynix Inc, and Tencent Holdings Ltd ADR, which highlight the fund’s focus on companies with strong market positions and growth potential. The market cap distribution is skewed towards extra-large and large-cap companies, which together account for over 83% of the portfolio. This allocation suggests a preference for established companies with robust financials and market leadership, which can provide stability and growth in the volatile emerging markets landscape.
Comparative Analysis with Similar Funds
In comparison to similar funds, MAPCX offers a unique focus on sustainable investments in Asian markets, excluding Japan. While its 1-year return of 10.95% is lower than some peers, such as abrdn Emerging Markets ex-China-Inst (GWLIX) with a 14.71% return, MAPCX’s emphasis on sustainability may appeal to investors prioritizing environmental and social governance (ESG) criteria. The fund’s expense ratio of 0.86% is competitive, though slightly higher than some peers like JPMorgan Emerging Markets Equity-I (JEMSX) with an expense ratio of 0.99%. Investors should consider these factors, along with the fund’s risk metrics and sector allocation, when evaluating MAPCX against other emerging market funds.
Expense Ratio and Yield Considerations
MAPCX’s expense ratio of 0.86% is a critical factor for investors to consider, as it impacts the net returns of the fund. This expense ratio is relatively competitive within the emerging markets category, offering a balance between cost and the potential for sustainable growth. Additionally, the fund’s yield of 1.35% provides a modest income stream, which can be attractive for investors seeking both growth and income. However, it is essential for investors to weigh the expense ratio against the fund’s performance and risk metrics to determine if MAPCX aligns with their investment objectives and cost expectations.
Conclusion: Suitability for Investors
MAPCX stands out as a fund that offers exposure to the high-growth potential of Asian markets, with a specific focus on sustainability. Its strategic allocation in technology and financial sectors, combined with its commitment to sustainable investments, makes it an attractive option for investors seeking long-term growth in emerging markets. However, the fund’s higher volatility and recent underperformance relative to its benchmark may not suit all investors. Those with a higher risk tolerance and a focus on sustainable investing may find MAPCX to be a valuable addition to their portfolio. It is crucial for investors to consider their investment goals, risk appetite, and the fund’s alignment with their values when deciding to invest in MAPCX.
Similar Securities
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PAIJX: Em Mkts Discv Stk Adv | Emerging Markets Growth Fund
PAIJX focuses on undervalued large-cap stocks in emerging markets, offering a 2.51% yield. It stands out with a diversified portfolio and growth potential.
NEWFX: American Funds New World-A | Emerging Markets Growth Potential
NEWFX offers diversified exposure to emerging markets with a focus on growth. It features a competitive expense ratio and a strong portfolio of top global companies.
IEMFX: TRPrice Inst Emerging Market Equity-Inst | Emerging Markets Growth Fund
IEMFX offers exposure to emerging markets with a focus on large-cap equities, a 1% expense ratio, and a 1.87% yield, suitable for growth-oriented investors.
BLSAX: BlackRock Advantage Emerging Market-InvA | Emerging Markets Growth Fund
BLSAX offers diversified exposure to emerging markets with a focus on total return. It stands out with a 1-year return of 14.50% and a yield of 1.83%.
Futher Reading
https://www.morningstar.com/funds/xnas/MAPCX/quote
https://finance.yahoo.com/quote/MAPCX/”>Yahoo: BlackRock Sustain Emg Mkts Equity-Inst
https://ftcloud.fasttrack.net/web/chart/MAPCX
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