“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%
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