BlackRock Global Long/Short Credit Absolute Return Credit

Derivative Usage, Instruments and Risks Management of credit risk while minimizing other risk factors The hedging process for interest rate and currency risks is separate from the credit decision • Hedges are carefully identified and managed based on asset type Hedges Active Credit Decisions Instrument FX forwards Treasury futures Bund futures UK Gilt futures Interest rate cap Interest rate options CDS CDX/iTraxx Equity index futures Equity index options Total return swaps BLACKROCK* Reason for Use Hedge non-US currency risk back to USD Hedge duration for US bond investments Hedge duration for European bond investments Hedge duration for UK bond investments Hedge duration for select non-US investments Hedge duration for select US bond investments Express a long or short credit view on an issuer or hedge a long position Gain or hedge asset class exposures via an equally-weighted index of CDS Hedge portfolio credit risk Hedge portfolio credit risk Hedge credit risk/convertible bond option premium or express a negative view on a stock Risks Foreign currency risk FOR FINANCIAL PROFESSIONAL USE ONLY. NOT TO BE SHOWN OR DISTRIBUTED TO THE GENERAL PUBLIC. Interest rate risk Market risk Liquidity risk Credit risk Counterparty risk Market risk Counterparty risk Market risk Counterparty risk USR0418U-470515-1498457 37

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