City Of London
BlackRock Moved to Unwind Trades at the Center of Gilt Selloff
- The asset manager contacted pension clients on Wednesday
- The Bank of England intervened in the UK gilt market
This article is for subscribers only.
BlackRock Inc. told pension clients it would unwind some trades it managed for them before the Bank of England stepped into the UK government bond market on Wednesday.
BlackRock said it would reduce or cut leveraged exposure in so-called liability-driven investment, or LDI, funds and move assets to cash rather than ask for additional collateral to meet margin calls, according to a memo the US asset manager sent customers Wednesday morning. It recommended a gilt fund for exposure to sterling-denominated rates and inflation. The FT reported the memo earlier.