In this article
BlackRock is applying hedge fund strategies to its exchange-traded fund business.
Jeffrey Rosenberg, the firm’s senior portfolio manager on the systemic fixed income team, has a leading role in the firm’s liquid alternatives ETFs — which use a long-short strategy in ETF wrappers.
He contends the strategy provides valuable diversification amid the recent breakdown in the relationship between stocks and bonds.
“The great old adage around fixed income is ‘my bonds go up when my stocks go down.’ Now, we just went through a period in March with war risk where we clearly saw again on display... that doesn’t hold. And, really saw it in 2022,” Rosenberg told CNBC’s “ETF Edge” this week. “This entire post-Covid environment has really challenged that bedrock principle of the 60-40 portfolio that bonds are diversifying.”
