BlackRock plans use of corporate bond repo in new LDI fund

Holding corporate bonds would provide backup liquidity, lift returns

Blackrock-corporate-bond-repo montage

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 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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