BlackRock BLK has crossed the $15 trillion AUM milestone, fueled in large part by the rapid growth of its Exchange-Traded Fund (ETF) business. ETFs now represent more than 40% of the firm's assets, compared with 25% a decade ago, as quoted on ETF Central.
BlackRock, through its iShares brand, continues to lead the global ETF market. Its current expansion is driven by strong adoption of active ETFs, fixed-income products, and portfolio adjustments to accommodate the explosive growth of mega-cap AI and tech stocks. Investors can now access about 1,600 iShares ETFs globally -- up 50% since 2019.
Inside the Success
BlackRock noted that ETFs are increasingly preferred by digital wealth investors because they provide access to both active and index investing. The company aims to shift people's mindset from saving to investing.
Today, 43 million people worldwide use iShares ETFs, and the company aims to more than double that figure to 100 million by the end of the decade.
The company expects the digital wealth market to grow into a $17 trillion industry by 2030, with ETFs playing a major role in driving this growth.
Inside the Variations of ETFs
BlackRock highlighted the following categories as key ETF areas.
Core ETFs provide a cost-effective way to build long-term portfolios.
Bond ETFs offer exposure to bond markets more capably.
Active ETFs aim to generate enhanced income or downside protection through options-based strategies.
Factor ETFs have the potential to outperform market-cap benchmarks.
Precision ETFs provide access to a wide range of countries, sectors and commodities.
Investors can use iShares ETFs for growth, income, diversification, systematic investing, megatrends and thematic exposure, alternative investments, as well as sustainable and transition investing.
Any Changes in the Asset Class’s Categorization?
BlackRock predicts global bond ETF assets under management (AUM) will reach $6 trillion by the end of 2030, up from $2.6 trillion in 2024, as quoted on its website. The ongoing modernization of the bond market is expected to drive this growth.
What About Fees?
BlackRock has periodically cut expense ratios on its core and flagship ETFs to remain competitive against rivals like Vanguard and Charles Schwab. Earlier fee reductions brought the expense ratio of the iShares Core S&P 500 ETF IVV down to 0.03%, matching the Vanguard 500 Index Fund ETF VOO expense ratio, while the iShares Core U.S. Aggregate Bond ETF AGG expense ratio was also reduced to 0.03%.
Bottom Line
While BlackRock's success is commendable, Vanguard has overtaken BlackRock to become the largest U.S. ETF issuer, ending BlackRock's roughly 20-year reign at the top. This underscores the importance of low fees in the ETF marketplace.
A mid-June article from The Daily Upside indicated that Vanguard manages around $4.39 trillion across 116 U.S.-listed funds, according to Bloomberg data, surpassing the $4.36 trillion managed by BlackRock, as quoted on Yahoo Finance.
Nevertheless, BlackRock's achievement highlights the remarkable growth of the ETF industry. Some of the most popular U.S.-based iShares ETFs include IVV, iShares Core MSCI EAFE ETF IEFA, iShares Core MSCI Emerging Markets ETF IEMG, AGG and iShares Russell 1000 Growth ETF IWF.
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BlackRock (BLK): Free Stock Analysis Report
Vanguard 500 Index Fund ETF Shares (VOO): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
iShares Core U.S. Aggregate Bond ETF (AGG): ETF Research Reports
iShares Russell 1000 Growth ETF (IWF): ETF Research Reports
iShares Core S&P 500 ETF (IVV): ETF Research Reports
iShares Core MSCI EAFE ETF (IEFA): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).