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BlackRock expects to have a record year for net inflows across its product portfolio, driven by demand for its active ETF lineup and model portfolio products, according to Chief Financial Officer Martin Small. It is said that
The company’s asset management company posted more than $360 billion in net inflows in the first three quarters of this year, much of it from investments in ETFs, according to quarterly earnings statistics.
Most of the $220 billion in net inflows occurred in the third quarter, pushing total assets under management to a record $11.5 trillion.
“(The) Active ETF Toolkit has changed the way model portfolio builders do things,” Small said earlier this month at the Goldman Sachs 2024 U.S. Financial Services Conference, adding that model portfolio builders will have a He added that the company is looking for flexibility.
This article was previously published by Ignites, a title owned by FT Group.
The firm’s suite of ETFs, including BlackRock and IShares strategies, totaled more than $170 billion in net inflows in the first three quarters of this year, according to Morningstar Direct data.
Investors poured an additional $34 billion into the company’s ETFs in October, according to the data.
BlackRock has one of the largest active ETFs in the industry, which has partially contributed to the firm’s record inflows, and these strategies have been particularly successful with model portfolio providers, Small said. said.
These include the manager’s $13.7 billion iShares U.S. Equity Factor Rotation Active ETF and $6.7 billion iShares Flexible Income Active ETF.
The two ETFs recorded net inflows of $11 billion and $5.5 billion, respectively, from January to October, according to data from Morningstar Direct.
Small also pointed to the company’s iShares Bitcoin Trust, which has amassed more than $50.8 billion in assets through the end of October since its creation on January 5, according to Morningstar Direct data. It is said that he did.
“I’ve never seen anything like that in my career where you basically go from zero to $50 billion in six months,” he said.
“Many model portfolios add more active ETFs to gain more active exposure while simultaneously controlling costs and taking advantage of the portability that ETFs provide,” said Morningstar analyst Jason Kephart. “We’re open to the idea that it’s going to happen,” he said, adding that BlackRock is benefiting from that.
He said trading flexibility was one of the main reasons for its recent inclusion in the model.
Part of BlackRock’s success across its ETF suite is that it operates its own model portfolio business, one of the largest third-party platforms in the industry, Kephart said.
The company is adding its own ETFs to its model portfolio platform, which is increasing flows, he said.
Model portfolios themselves are becoming a more popular investment tool, according to a recent report from State Street Global Advisors.
According to the firm’s research, advisors reported that 39% of their assets under management were models, up from 32% just three years ago.
According to the report, approximately 54% of advisors use custom models, another 45% use custom models on broker-dealer platforms, and 53% use custom models with third-party providers.
*Ignites is a news service for professionals in the asset management industry published by FT Specialist. Trials and subscriptions are available at ignites.com.
