Lower Prices for 15 U.S. iShares Core ETFs
A New Market Convention for Long-Term Investors
Move to Help Advisors Transition to DoL Fiduciary Rule
Strategic Investment to Drive Higher Organic Asset and Revenue Growth
NEW YORK--(BUSINESS WIRE)--
BlackRock, Inc. (NYSE:BLK) today set a new market standard for long-term
investors by reducing prices across its growing U.S. iShares Core ETFs.
Institutions, individuals, and financial advisors are increasingly
putting low-cost ETFs at the center of their long-term investments. Now,
with the Department of Labor (DoL) fiduciary rule coming into force,
financial advisors are sharpening their focus on the quality and
cost-efficiency of funds. BlackRock expects these advisors will use ETFs
more and more as active tools and alongside high-conviction active funds
to build better portfolios for clients. We also expect financial
advisors will increasingly turn to core ETFs for long-term holdings,
where value matters most.
A New Convention for Core Investing
BlackRock is re-pricing U.S. iShares Core ETFs to set a new market
convention for all long-term investors and to lead this fast-growing
segment of the ETF market.
“A new era is dawning for advisors and long-term investors of all kinds.
To meet this historic shift, we aim to set a new market convention for
core investing and long-term investors,” said Mark Wiedman, Global Head
of iShares. “We brought ETFs and active management together in 2009. In
2012, we launched the iShares Core to serve long-term investors looking
for great value at the center of their portfolios. Since then,
individual and institutional investors have adopted iShares Core ETFs
faster than we imagined. We expect this trend only to quicken.”
Quality Funds at a Great Value
“The iShares Core already offers investors and advisors the tax
efficiency1, liquidity and quality they need at the
foundation of their portfolios2. Now they can have the same
quality at an even greater value,” said Martin Small, U.S. Head of
iShares.
“We want iShares Core ETFs to be the market convention for all kinds of
ETF users - home office models, digital advice platforms, asset managers
and other institutions, financial advisors, and self-directed investors.
We also see the Core as central to deepening our relationships with
these clients. When our clients choose the iShares Core for the heart of
their portfolios, they open conversations with us about other iShares
and BlackRock funds.”
Helping Advisors Transition to DoL Fiduciary
Rule
“This is another critical milestone to help advisors as they prepare for
the major shift the DoL fiduciary rule requires – providing investors
with quality index exposures at great value in the center of their
portfolios,” said Salim Ramji, Head of BlackRock's U.S. Wealth Advisory
business. “These enhancements to the iShares Core are the latest
innovation by BlackRock to help advisors build better portfolios for
investors. Together with Aladdin® Risk for Wealth,
our risk management and portfolio construction platform, FutureAdvisor,
a leader in B2B digital wealth management and our iRetire®
tools, we are committed to being a trusted partner to wealth advisors as
they transition to fiduciary practices. We also expect that deepening
our wealth advisory partnerships will only increase demand for iShares
ETFs and BlackRock active investments."
Enhancing Scale and Investing for Future Growth
BlackRock manages $1.3 trillion globally in AUM across its comprehensive
iShares product line, including nearly $1 trillion in precision
exposures and financial instruments favored by clients for their deep
liquidity and global breadth.3 With more than $90 billion in
net new assets raised this year, iShares is the U.S. and global leader
in both flows and assets under management.4
"As we communicated at our Investor Day in June, our firm’s history is
one of taking action to evolve our business ahead of changes in the
investment ecosystem to drive value for clients and shareholders,” said
Gary Shedlin, BlackRock’s Chief Financial Officer. “We brought together
active and passive on one platform in 2009, launched the iShares Core in
2012 and, as evidenced by the acquisition of FutureAdvisor, are
continuously finding new ways to use technology to better serve our
clients. Today's re-pricing of iShares Core ETFs is another example of
our commitment to maximize the benefits of scale as a means to
efficiently invest in our business and drive higher organic growth over
time.”
U.S. iShares Core – Pricing Updates effective October 5, 2016
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Category
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Fund
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Ticker
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Previous
Net
Expense
Ratio (BPS)
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New
Net
Expense
Ratio (BPS)
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U.S. Equity
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iShares Core S&P 500 ETF
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IVV
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7
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4
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iShares Core S&P Mid-Cap ETF
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IJH
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12
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7
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iShares Core S&P Small-Cap ETF
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IJR
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12
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7
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iShares Core High Dividend ETF
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HDV
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12
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8
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iShares Core Dividend Growth ETF
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DGRO
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12
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8
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International Equity
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iShares Core MSCI Total International Stock ETF
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IXUS
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14
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11
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iShares Core MSCI EAFE ETF
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IEFA
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12
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8
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iShares Core MSCI Europe ETF
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IEUR
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12
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10
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iShares Core MSCI Pacific ETF
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IPAC
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12
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10
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iShares Core MSCI Emerging Markets ETF
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IEMG
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16
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14
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Fixed Income
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iShares Core Total USD Bond Market ETF
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IUSB
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12
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8*
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iShares Core U.S. Aggregate Bond ETF
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AGG
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8
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5*
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iShares Core 1-5 Year USD Bond ETF
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ISTB
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12
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8
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iShares Core 10+ Year USD Bond ETF
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ILTB
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12
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8
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iShares Core International Aggregate Bond ETF
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IAGG
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15
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11
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BlackRock Enhances Index Mutual Funds Range
In addition to iShares Core ETFs, BlackRock manages core building block
exposures in index mutual fund vehicles. To seek to give investors the
broadest array of indexed investment choices for broad market exposures,
BlackRock also reduced expenses on five index mutual funds across Class
K, Institutional, and Investor A share classes. The BlackRock index
mutual fund family includes 13 funds investing in US equity, fixed
income, real estate, and international index-based strategies. BlackRock
has been managing index investment strategies on behalf of clients for
more than 40 years.
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Fund
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Class K ticker
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Gross
Expense Ratio
(BPS)1
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Previous
Net Expense
Ratio
(BPS)2
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New
Net Expense
Ratio
(BPS)3
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BlackRock Midcap Index Fund
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BRMKX
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10
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84
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74
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BlackRock Small/Mid Cap Index Fund
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BSMKX
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18
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84
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74
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BlackRock Small Cap Index Fund
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BDBKX
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20
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125
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75
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BlackRock Total International ex U.S/ Index Fund
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BDOKX
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46
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125
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115
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BlackRock U.S. Total Bond Index Fund
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WFBIX
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9
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65
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55
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About BlackRock
BlackRock is a global leader in investment management, risk management
and advisory services for institutional and retail clients. At June 30,
2016, BlackRock’s AUM was $4.890 trillion. BlackRock helps clients
around the world meet their goals and overcome challenges with a range
of products that include separate accounts, mutual funds, iShares®
(exchange-traded funds), and other pooled investment vehicles. BlackRock
also offers risk management, advisory and enterprise investment system
services to a broad base of institutional investors through BlackRock
Solutions®. As of June 30, 2016, the firm had
approximately 12,700 employees in more than 30 countries and a major
presence in global markets, including North and South America, Europe,
Asia, Australia and the Middle East and Africa. For additional
information, please visit the Company’s website at www.blackrock.com
| Twitter: @blackrock_news
| Blog: www.blackrockblog.com
| LinkedIn: www.linkedin.com/company/blackrock
About iShares
iShares® is a global leader in exchange-traded funds
(ETFs), with more than a decade of expertise and commitment to
individual and institutional investors of all sizes. With over 700 funds
globally across multiple asset classes and strategies and more than $1
trillion in assets under management as of June 30, 2016, iShares
helps clients around the world build the core of their portfolios, meet
specific investment goals and implement market views. iShares
funds are powered by the expert portfolio and risk management of
BlackRock, trusted to manage more money than any other investment firm.5
* Net expense ratios are shown. BlackRock Fund Advisors ("BFA"), the
investment adviser to the Funds and an affiliate of BlackRock
Investments, LLC, has contractually agreed to waive a portion of its
management fees through 06/30/2021 for AGG and 02/28/2019 for IUSB.
Gross expenses for these funds are 0.06% and 0.10% respectively.
Carefully consider the funds' investment objectives, risk factors,
and charges and expenses before investing. This and other information
can be found in the funds' prospectuses or, if available, the summary
prospectuses which may be obtained by visiting www.iShares.com
or www.blackrock.com.
Read the prospectus carefully before investing.
Investing involves risk, including possible loss of principal.
Transactions in shares of the iShares funds will result in brokerage
commissions and will generate tax consequences. iShares funds are
obliged to distribute portfolio gains to shareholders. There can be no
assurance that an active trading market for shares of an ETF will
develop or be maintained. Diversification and asset allocation may not
protect against market risk or loss of principal.
The Funds are distributed by BlackRock Investments, LLC (together with
its affiliates, “BlackRock”).
The iShares Funds are not sponsored, endorsed, issued, sold or promoted
by MSCI Inc., Russell Investment Group or S&P Dow Jones Indices LLC.
None of these companies make any representation regarding the
advisability of investing in the Funds. BlackRock is not affiliated with
the companies listed above.
©2016 BlackRock. All rights reserved. iSHARES and BLACKROCK
are registered trademarks of BlackRock. All other marks are the property
of their respective owners. iS-19344-1016
1 97% of iShares have not distributed a capital gain in the
last five years, as of 12/31/15.
2 Over a three year period, as of 12/31/2015, 64% of global
iShares Funds were within 25 bps and 82% were within 50 bps of their
benchmarks, based on the Net Asset Value of the Funds.
3 Source: BlackRock and Bloomberg as of 9/30/16
4 Source: BlackRock and Bloomberg as of 9/30/16
5 Based on $4.89T in AUM as of 6/30/16.
Forward-looking Statements.
This press release, and other statements that BlackRock may make, may
contain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act, with respect to BlackRock’s future
financial or business performance, strategies or expectations.
Forward-looking statements are typically identified by words or phrases
such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,”
“comfortable,” “expect,” “anticipate,” “current,” “intention,”
“estimate,” “position,” “assume,” “outlook,” “continue,” “remain,”
“maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or
future or conditional verbs such as “will,” “would,” “should,” “could,”
“may” and similar expressions. BlackRock cautions that forward-looking
statements are subject to numerous assumptions, risks and uncertainties,
which change over time. Forward-looking statements speak only as of the
date they are made, and BlackRock assumes no duty to and does not
undertake to update forward-looking statements. Actual results could
differ materially from those anticipated in forward-looking statements
and future results could differ materially from historical performance.
Additional Index Mutual Funds Footnotes
1 Gross expense ratio is based on the applicable fund’s
prospectus dated October 5, 2016.
2 Previous net expense ratio is based on the applicable
fund’s prospectus effective prior to October 5, 2016 and reflects net
expenses, excluding investment related expenses, which are investment
dividend expenses, interest expense, acquired fund fees and expenses and
certain other fund expenses.
3 New net expense ratio is based on the applicable fund’s
prospectus dated October 5, 2016, and reflects net expenses, excluding
investment related expenses, which are investment dividend expenses,
interest expense, acquired fund fees and expenses and certain other fund
expenses.
4 Previous net expense ratio for Class K shares of the fund
had contractual waivers with an end date of November 30, 2016. New net
expense ratios for Class K shares of the fund have contractual waivers
with an end date of November 30, 2017, terminable upon 90 days’ notice.
5 Previous net expense ratio for Class K shares of the fund
had contractual waivers with an end date of April 30, 2017. New net
expense ratios for Class K shares of the fund have contractual waivers
with an end date of April 30, 2018, terminable upon 90 days’ notice.
Class K Shares are available only to certain (i) employer-sponsored
retirement plans, (ii) collective trust funds, investment companies and
other pooled investment vehicles, (iii) institutional investors and (iv)
other investors who met the eligibility criteria for BlackRock shares or
Class K shares prior to August 15, 2016 and have continually held Class
K shares of the fund in the same account since August 15, 2016. Class K
Shares have a $5 million initial minimum investment requirement, unless
purchased as part of a qualified plan.
The net expense ratios for Institutional and Investor A shares will be
higher than the net expense ratios for Class K shares set forth above.
View source version on businesswire.com: http://www.businesswire.com/news/home/20161004006722/en/
BlackRock, Inc.
Brian Beades, 212-810-5596
Brian.Beades@blackrock.com
or
Peter
McKillop, 212-810-3737
Peter.McKillop@blackrock.com
or
Melissa
Garville, 212-810-5528
Melissa.Garville@blackrock.com
Source: BlackRock, Inc.