19% annual organic growth driven by minimum
volatility, single and multifactor funds
World’s largest smart beta ETF provider
launches nine new multifactor sector ETFs
Record demand for smart beta products
‘democratizing’ factor investing and driving innovation
BlackRock’s (NYSE:BLK) iShares business, the world’s largest
manager of exchange traded funds (ETFs), projects that smart beta
ETF assets will reach $1 trillion globally by 2020 and $2.4
trillion by 2025.1 With current smart beta ETF assets at $282bn, 2
this reflects an annual organic growth rate of 19%, double the
growth rate of the overall ETF market. Minimum volatility and
factor (multi and single) funds are expected to be key drivers of
future growth and represent over 60% of new smart beta flows
through 2025.1
BlackRock’s Factor-Based Strategies Group, led by Andrew Ang,
PhD, oversees the broadest suite of factor-based products and
capabilities, with more than $142 billion assets under management.
BlackRock’s iShares business is the largest provider of smart beta
ETFs, managing over $67 billion in ETFs across 96 products
globally. 2
Smart beta ETFs have become increasingly popular strategies for
investors seeking to manage risk and obtain precise exposure to
historically return driving factors, and saw $31bn in new flows
globally in 2015. Minimum volatility ETFs were a major contributor
in 2015 with over $11bn of inflows, and have led the way in 2016
with a record-breaking $12.6bn of inflows year-to-date.1
Against a backdrop of continued expected growth, BlackRock is
launching a series of initiatives to enhance the smart beta
investing experience for its clients:
- Nine new iShares multifactor sector
ETFs. Investors are now able to gain targeted exposure to
single sectors including technology, financials and energy, powered
by a combination of four historically rewarded factors: value,
quality, momentum and size.
- Launches BlackRock’s factors website
and publishes the iShares smart beta guide. The newly launched
BlackRock.com/factors website is an online resource providing
clients with educational content, tools and analytics to help them
to better understand factor investing and smart beta strategies.
BlackRock is also rolling out an iShares smart beta guide, helping
to educate investors how to evaluate and implement factors in smart
beta strategies.
- Introduces iShares Edge, a
clearly defined suite of iShares factor ETFs, covering minimum
volatility, single and multifactor funds. This included renaming 26
existing funds and the inclusion of 9 new multifactor sector funds,
representing more than $28bn in assets under management. 3
Martin Small, BlackRock’s Head of U.S. iShares, said:
“Smart beta ETFs are growing increasingly popular, as evidenced
by their record flows in 2015 and the first quarter of 2016 with
investors using them to manage risk and obtain precise exposure to
historically return driving factors. In response to continued
demand and strong expected future growth, BlackRock is introducing
the iShares Edge MSCI Multifactor Sector ETFs. These funds
represent the next phase of sector investing: using a factors-based
approach to target companies with the potential to outperform their
broader respective sectors over multiple market cycles.
“As a leader and innovator in smart beta investing, clients look
to BlackRock for information and insight. In response, we’ve
launched a range of educational tools to bring our clients greater
clarity and help them to navigate the market. We’ve also
consolidated our smart beta ETF products that provide precise
factor exposures under a single, unified brand.”
Andrew Ang, Head of Factor Investing Strategies at BlackRock,
said:
“The rise of smart beta - propelled by advances in technology
and data analytics - is helping to democratize factor investing,
putting investment solutions once only accessible to large
institutions within the reach of all investors.”
“Smart beta consists of long-only, benchmark driven strategies
built to capture one or multiple factors while pursuing a variety
of outcomes, such as reducing risk, enhancing returns or improving
diversification. This investment style is predicated on the
understanding that the risks and returns of all investments, no
matter how nominally diverse, can be mapped to a common set of
underlying factors. Today, these factors can be captured with cost
effective and efficient smart beta ETFs.”
The iShares Edge MSCI Multifactor ETFs: The next phase of
sector investing
Today’s launch of nine new iShares Edge MSCI Multifactor Sector
ETFs expands the iShares suite of multifactor ETFs to 15 funds, and
includes sector exposures for the first time. The funds target
select companies within each U.S. stock sector and focus on
financially healthy firms (quality), inexpensive stocks (value),
smaller companies (size), and trending stocks (momentum).
The new funds launched today are:
Ticker Fund name
ERGF
iShares Edge MSCI Multifactor Energy ETF MATF
iShares Edge MSCI Multifactor Materials ETF INDF
iShares Edge MSCI Multifactor Industrials ETF CNDF
iShares Edge MSCI Multifactor Consumer Discretionary ETF
CNSF iShares Edge MSCI Multifactor Consumer Staples
ETF HCRF iShares Edge MSCI Multifactor Healthcare ETF
FNCF iShares Edge MSCI Multifactor Financials ETF
TCHF iShares Edge MSCI Multifactor Technology ETF
UTLF iShares Edge MSCI Multifactor Utilities ETF
Investor education: launch of BlackRock factors website and
smart beta guide
BlackRock is pleased to introduce a new website dedicated to
factor investing, BlackRock.com/factors. Investors will be able to
access a wealth of online content including interactive analysis,
tools and videos, helping them better understand factors and
factor-based strategies like smart beta.
iShares is also launching a smart beta guide for clients
interested in investing in smart beta ETFs. The brochure will help
them navigate the smart beta landscape, and provides insights on
how to evaluate smart beta products and practical portfolio
implementation examples of smart beta ETFs.
BlackRock’s factor investing platform
With over $142bn in AUM in factor-based strategies, BlackRock is
currently one of the largest managers in the space and has the
broadest suite of factor-based products and capabilities. The firm
manages over $67bn in iShares smart beta ETFs, across 96 products
globally. 2
BlackRock’s factor investing platform is led by Andrew Ang, PhD.
Prior to joining BlackRock in 2015, Dr. Ang was Chair of the
Finance and Economics Division and the Ann F. Kaplan Professor of
Business at Columbia. Dr. Ang’s recent book “Asset Management: A
Systematic Approach to Factor Investing”, published by Oxford
University Press in 2014, has been lauded by the investment
community.
The iShares Edge ETF suite
Find below a full list of the funds that are changing names and
becoming part of the iShares Edge suite. Including the nine new
multifactor sector funds, the iShares Edge suite comprises eight
single factor, 15 multifactor, 11 minimum volatility and one fixed
income ETF3. The suite represents more than $28bn in assets under
management.
Ticker Previous Name
New name EMGF iShares FactorSelectTM MSCI
Emerging ETF iShares Edge MSCI Multifactor Emerging
Markets ETF ACWF iShares FactorSelectTM MSCI Global
ETF iShares Edge MSCI Multifactor Global ETF INTF
iShares FactorSelectTM MSCI International ETF
iShares Edge MSCI Multifactor Intl ETF ISCF
iShares FactorSelectTM MSCI Intl Small-Cap ETF
iShares Edge MSCI Multifactor Intl Small-Cap ETF LRGF
iShares FactorSelectTM MSCI USA ETF iShares Edge MSCI
Multifactor USA ETF SMLF iShares FactorSelectTM MSCI
USA Small-Cap ETF iShares Edge MSCI Multifactor USA
Small-Cap ETF USMV iShares MSCI USA Minimum
Volatility ETF iShares Edge MSCI Min Vol USA ETF JPMV
iShares MSCI Japan Minimum Volatility ETF
iShares Edge MSCI Min Vol Japan ETF ACWV
iShares MSCI All Country World Minimum Volatility ETF
iShares Edge MSCI Min Vol Global ETF AXJV iShares
MSCI Asia ex Japan Minimum Volatility ETF iShares
Edge MSCI Min Vol Asia ex Japan ETF EFAV iShares MSCI
EAFE Minimum Volatility ETF iShares Edge MSCI Min Vol
EAFE ETF EEMV iShares MSCI Emerging Markets Minimum
Volatility ETF iShares Edge MSCI Min Vol Emerging
Markets ETF EUMV iShares MSCI Europe Minimum
Volatility ETF iShares Edge MSCI Min Vol Europe ETF
HACV iShares Currency Hedged MSCI ACWI Minimum
Volatility ETF iShares Edge MSCI Min Vol Global
Currency Hedged ETF HEFV iShares Currency Hedged MSCI
EAFE Minimum Volatility ETF iShares Edge MSCI Min Vol
EAFE Currency Hedged ETF HEMV iShares Currency Hedged
MSCI EM Minimum Volatility ETF iShares Edge MSCI Min
Vol EM Currency Hedged ETF HEUV iShares Currency
Hedged MSCI Europe Minimum Volatility ETF iShares
Edge MSCI Min Vol Europe Currency Hedged ETF MTUM
iShares MSCI USA Momentum Factor ETF iShares Edge
MSCI USA Momentum Factor ETF QUAL iShares MSCI USA
Quality Factor ETF iShares Edge MSCI USA Quality
Factor ETF SIZE iShares MSCI USA Size Factor ETF
iShares Edge MSCI USA Size Factor ETF VLUE
iShares MSCI USA Value Factor ETF iShares Edge
MSCI USA Value Factor ETF IMTM iShares MSCI
International Developed Momentum Factor ETF iShares
Edge MSCI Intl Momentum Factor ETF IQLT iShares MSCI
International Developed Quality Factor ETF iShares
Edge MSCI Intl Quality Factor ETF ISZE iShares MSCI
International Developed Size Factor ETF iShares Edge
MSCI Intl Size Factor ETF IVLU iShares MSCI
International Developed Value Factor ETF iShares Edge
MSCI Intl Value Factor ETF INC3 iShares U.S. Fixed
Income Balanced Risk ETF iShares Edge U.S. Fixed
Income Balanced Risk ETF
About BlackRock
BlackRock is a global leader in investment management, risk
management and advisory services for institutional and retail
clients. At March 31, 2016, BlackRock’s AUM was $4.737 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
March 31, 2016, the firm had approximately 13,000 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 March 31, 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.4
1 Source: BlackRock Global Business Intelligence as of 5/10/162
Source: Bloomberg as of 3/31/163 iShares Edge U.S. Fixed Income
Balanced Risk ETF (whose ticker is being changed from INC to
FIBR).4 Based on $4.737 trillion in AUM as of 3/31/16.
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.
There can be no assurance that performance will be enhanced or
risk will be reduced for funds that seek to provide exposure to
certain quantitative investment characteristics ("factors").
Exposure to such investment factors may detract from performance in
some market environments, perhaps for extended periods. In such
circumstances, a fund may seek to maintain exposure to the targeted
investment factors and not adjust to target different factors,
which could result in losses. The iShares Minimum Volatility ETFs
may experience more than minimum volatility as there is no
guarantee that the underlying index's strategy of seeking to lower
volatility will be successful.
The iShares 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., nor does this company make any
representation regarding the advisability of investing in the
Funds. BlackRock is not affiliated with MSCI Inc.
©2016 BlackRock. All rights reserved. iSHARES and
BLACKROCK are registered trademarks of BlackRock. All other
marks are the property of their respective owners.
iS-18334-0516
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version on businesswire.com: http://www.businesswire.com/news/home/20160512006061/en/
BlackRockPaul Young, 212-810-8142Paul.Young@blackrock.comorPeter
McKillop, 212-810-3737Peter.McKillop@blackrock.com
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