BlackRock has introduced two actively managed ETFs on the New York Stock Exchange:
- BlackRock Large Cap Value ETF (BLCV):
- Ticker: NYSE Arca: BLCV
- Objective: Seeks maximum total return by investing in large-cap U.S. equities that exhibit value characteristics.
- Investment Strategy: Focuses on undervalued companies within the Russell 1000 Value Index to provide exposure to true value opportunities.
- Lead Manager: Tony DeSpirito, global CIO of fundamental equities.
- BlackRock Flexible Income ETF (BINC):
- Ticker: NYSE Arca: BINC
- Objective: Aims to deliver long-term income through investments in debt and income-producing securities.
- Investment Strategy: Primarily allocates to harder-to-reach fixed income sectors, including high yield, emerging markets debt, and securitized assets. Complements core bond exposures.
- Lead Manager: Rick Rieder, BlackRock’s CIO of global fixed income.
The BlackRock Flexible Income ETF (BINC) adopts an active management style to take advantage of unique opportunities in the fixed income market, which is characterized by increasing dispersion and yields. Rick Rieder highlights the complexity of fixed income investments.
Active ETFs have experienced significant growth, with $402 billion in assets under management and a compound annual growth rate of 54% over the past three years. Fee-based advisers using model portfolios have shown strong demand for ETFs as efficient investment vehicles.
While BlackRock has been successful with its index funds, such as iShares Russell 1000 Value ETF (IVE), iShares Russell 1000 Value ETF (IWD), and iShares MSCI USA Value Factor ETF (VLUE), the firm also manages $13 billion in assets across 20 active ETFs. The introduction of BLCV and BINC provides advisors with actively managed alternatives.
The expense ratios for BLCV and BINC are 0.55% and 0.40%, respectively.