BlackRock to launch four ETFs
BlackRock will launch four new iShares Edge Smart beta exchange-traded funds (ETFs), a suite of low volatility and multifactor funds, dedicated to Australian investors, on Friday.
The newly-launched ETFs were expected to provide investors with similar access and opportunities that were previously available only for the large institutions, according to BlackRock.
The firm has identified the four style factors, which the new funds would draw on, as "broad and persistent drivers of returns" and which were present in active management across asset classes.
These factors were: quality which referred to financial health of companies, value understood as inexpensive stocks, size, and momentum. According to BlackRock, each stock would be given a score against these four factors.
Head of iShares Australia, Jon Howie, also stressed that although the concept of factors was not new, BlackRock planned to revolutionise it with the use of the technology which allowed factors to be isolated with greater precision and delivered in simple investment products, such as ETFs.
iShares Edge Minimum Volatility funds will follow indices that track low volatility stocks while factoring in the correlations among them while iShares Edge Multifactor ETFs will be dedicated to deliver above-market returns over the long-term and will follow stocks displaying high aggregate exposure to four style factors.
"The new funds offer Australian investors the same opportunities that were once accessible to large institutions, in a low cost, convenient and transparent manner," Howie said.
BlackRock also expects the new products will prove popular with institutional investors, both domestically and overseas, as well as Australian dealer groups, in particular the largest ones that have their own research capabilities.
Both iShares edge minimum volatility ETFs and iShares Edge Multifactor ETFs will be available across Australian and global equities.
AUTHOR
Oksana Patron
Recommended for you
New research has revealed which fund manager is the most recommended by financial advisers to their clients, as well as the most preferred research houses.
The departure of BlackRock’s head of global client business Mark Wiedman after his 21-year tenure has prompted a reshuffle, with several senior executives receiving promotions.
The volume that financial advisers have invested in private credit funds could be among disclosures that providers have to make to ASIC amid a regulatory crackdown on private markets.
Platinum Asset Management has appointed Northern Trust to provide asset servicing solutions for their $11 billion Australian funds.
