Source: Accelerating Growth: The Department of Labor Conflict of Interest rules and its Impact on the ETF industry

“ETFs were made for DOL,” Mark Wiedman, Global Head of iShares, told ETF Trends. “We think moving first and fast will really matter.”

The fee cuts may be a tactical way for BlackRock to position its ETFs as cheap fund alternatives in response to the changing DOL rules that will shine a light on the high costs associated with actively managed funds.

“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,” Salim Ramji, Head of BlackRock’s U.S. Wealth Advisory business, said in a note.

Moreover, the BlackRock cuts are seen as a natural result of scale as the iShares line of ETFs hold nearly $1 trillion in assets under management, with over $90 billion in net inflows this year.

“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,” Gary Shedlin, BlackRock’s Chief Financial Officer, said in a note.

As of October 5, 15 iShares Core ETFs have a lower expense ratio, including:

  • iShares Core S&P 500 ETF (NYSEArca: IVV): old 0.07%; new 0.04%
  • iShares Core S&P Mid-Cap ETF (NYSEArca: IJH): old 0.12%; new 0.07%
  • iShares Core S&P Small-Cap ETF (NYSEArca: IJR): old 0.12%; new 0.07%
  • iShares Core High Dividend ETF (NYSEArca: HDV): old 0.12%; new 0.08%
  • iShares Core Dividend Growth ETF (NYSEArca: DGRO): old 0.12%; new 0.08%
  • iShares Core MSCI Total International Stock ETF (NYSEArca: IXUS): old 0.14%; new 0.11%
  • iShares Core MSCI EAFE ETF (NYSEArca: IEFA): old 0.12%; new 0.08%
  • iShares Core MSCI Europe ETF (NYSEArca: IEUR): old 0.12%; new 0.10%
  • iShares Core MSCI Pacific ETF (NYSEArca: IPAC): old 0.12%; new 0.10%
  • iShares Core MSCI Emerging Markets ETF (NYSEArca: IEMG): old 0.16%; new 0.14%
  • iShares Core Total USD Bond Market ETF (NYSEArca: IUSB): old 0.12%; new 0.08%
  • iShares Core U.S. Aggregate Bond ETF (NYSEArca: AGG): old 0.08%; new 0.05%
  • iShares Core 1-5 Year USD Bond ETF (NYSEArca: ISTB): old 0.12%; new 0.08%
  • iShares Core Long-Term US Bond ETF (NYSEArca: ILTB): old 0.12% new 0.08%
  • iShares Core International Aggregate Bond ETF (NYSEArca: IAGG): old 0.15%; new 0.11%

For more information on the ETF industry, visit our current affairs category.

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