Preferred Portfolio Management

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Mariah Marsh
5 years ago
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1 Preferred Portfolio Management Separately managed fixed income accounts

2 Personal portfolio manager Partnering with Preferred Portfolio Management brings you the power of BlackRock through your personal Portfolio Manager. Your Portfolio Manager and Financial Advisor can work together to manage your portfolio, as the markets or your personal circumstances may change. As a client, not only will you receive quarterly performance reporting, but your Portfolio Manager will engage in personal meetings and conference calls so you know how your investments are working for you. Your portfolio manager at work Leveraging the power of BlackRock Investment capabilities Capital markets expertise Risk management Builds customized solution Monitors portfolio Two of the most distinguishing characteristics of a bond portfolio are Your portfolio manager the potential to generate income and preserve your initial investment. Using a consultative approach, together with your Financial Advisor, your personal portfolio manager can build a fixed income portfolio, in action aiming to provide the right balance between income generation and investment stability, for your situation today and for your future. A PPM account with a personal Portfolio Manager generally requires a minimum investment of $1 million. Accounts below $1 million (minimum $250,000) are serviced by a managed account team and have limited customization capabilities. For additional information, please speak to your Financial Advisor.

3 Customized for you Your Portfolio Manager partners with your Financial Advisor to understand your unique financial situation and then thoughtfully tailors a portfolio with your goals in mind. Given the flexibilities afforded within a separately managed account, the wide range of investment vehicles and the customization strategies available, PPM allows your portfolio to be just that yours. A portfolio built for you with the potential to MANAGE COMPLEX TAX SITUATIONS REDUCE INTEREST RATE RISK Municipal bonds Asset-backed securities Treasury bonds High yield Corporate bonds Agencies APPLY SOCIAL SCREENS GENERATE INCOME Preferred Portfolio Management by BlackRock offers various customizations to design a portfolio that is right for you. Customization As the largest manager of municipal bonds in the world, we have the ability to thoughtfully implement a number of state-specific portfolios, in action across varying maturity ranges, providing a tax-efficient, yet diversified portfolio. Source: BlackRock Municipal AUM 126 billion as of 3/31/18.

4 Scalable pricing power Working with BlackRock can position you to benefit from institutional pricing. We understand the importance of seeking the most beneficial price in any transaction to help you keep more of what you ve earned. The municipal bond market is highly fragmented. This can create difficulties for individual investors looking for municipal buyers or sellers. An individual may need to offer a higher price to purchase a security or accept a lower price to sell one. This price concession is often referred to as the spread. Why size and scale matter Institutional pricing advantage Spread (as % of PAR) <5K 10-25K 50K-100K 500K-1M 3-5M Transaction size ($) Source: BlackRock analysis sourced from MSRB Report on Secondary Market Trading in the Municipal Securities Market (Figure V.F), from calendar years 2003 through 2010, as of 3/31/18. Investment managers generally combine trades across their clients accounts, via a large network of dealers, which can potentially lead Pricing to better pricing due to a smaller spread. The above chart illustrates the different spreads achieved at different in action dollar values. The 2.46% spread on transactions up to $5,000 is significantly different from the 0.20% spread on transactions of $3 to $5 million. This 2.26% difference has a direct impact on the return achieved from an investment.

5 Build on BlackRock $ 1.88T+ in taxable fixed income mandates 1 Trusted to manage more money than any other investment firm *, BlackRock is committed to helping our clients navigate today s challenging markets. Founded as a fixed income provider, BlackRock uses its deep expertise to deliver quality service and support to our clients. $ 43B+ in separately managed fixed income accounts 2 Leading banks, insurance companies and sovereign nations rely on BlackRock to help manage the risk in their portfolios. We believe risk management is about understanding risk, not avoiding it. As a client, each of your investments will be monitored by Aladdin BlackRock s proprietary risk management engine to track the on-going health of your portfolio and examine its sensitivity to different market scenarios. One portfolio, one client at a time BlackRock Preferred Portfolio Management PPM offers separately managed fixed income accounts to institutions and affluent individuals like yourself whose assets merit personal attention. Tailoring to unique needs Trust & estate planning Tax management Philanthropic needs Income objectives 1. Source: BlackRock as of 3/31/ Source: BlackRock as of 12/31/17.

6 Why BlackRock BlackRock helps people around the world, as well as the world s largest institutions and governments, pursue their investing goals. We offer: A comprehensive set of innovative solutions, including mutual funds, separately managed accounts, alternatives and ishares ETFs Global market and investment insights Sophisticated risk and portfolio analytics We work only for our clients, who have entrusted us with managing $6.32 trillion*, earning BlackRock the distinction of being trusted to manage more money than any other investment firm in the world. Want to know more? blackrock.com (1-877-ASK-1BLK) * AUM as of 3/31/18. Investing involves risk, including possible loss of principal. Asset allocation and diversification may not protect against market risk, loss of principal or volatility of returns. Actual investment outcomes may vary. Two significant risks related to fixed income investing are interest rate risk and credit risk. Typically, when interest rates rise, there is a corresponding decline in the market value of bonds. Credit risk refers to the possibility that the issuer of the bond will not be able to make principal and interest payments. There may be less information available on the financial condition of issuers of municipal securities than for public corporations. The market for municipal bonds may be less liquid than for taxable bonds. A portion of the income may be taxable. Some investors may be subject to Alternative Minimum Tax (AMT). Capital gains distributions, if any, are taxable. Municipal securities may not be suitable for all investors. There is no guarantee that these investment strategies will work under all market conditions or are suitable for all investors and each investor should evaluate their ability to invest long-term, especially during periods of downturn in the market. No representation is being made that any account, product, or strategy will or is likely to achieve profits. This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. You should consult your tax or legal advisor regarding such matters BlackRock, Inc. All Rights Reserved. BLACKROCK is a registered trademark of BlackRock, Inc. or its subsidiaries in the United States and elsewhere. All other trademarks are those of their respective owners. Lit. No. PPM-BROCH A-US4-0618

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