With a vast array of exchange traded funds (ETFs) to choose from, one way to attract investor capital is to offer low fees. BlackRock is doing just that with more funds in its iShares brand.
Here are a few of its ETFs to consider for cost-conscious investors.
A 60-40 Portfolio with Just 3 ETFs
For pundits of the traditional 60-40 stock to bond allocation, a combination of the iShares Core S&P 500 ETF (IVV) or the iShares Core S&P 500 ETF (IVV) with the iShares 0-3 Month Treasury Bond ETF (SGOV) can make for a complete portfolio. This makes for an easier solution than holding individual stocks and bonds.
IVV seeks to track the investment results of the S&P 500, which measures the performance of the large-capitalization sector of the U.S. equity market. The fund generally invests at least 90% of its assets in securities of the underlying index and in depositary receipts representing securities of the underlying index.
It may invest the remainder of its assets in certain futures, options and swap contracts, cash and cash equivalents, as well as in securities not included in the underlying index, but which the advisor believes will help the fund track the underlying index.
ITOT seeks to track the investment results of the S&P Total Market Index, which is comprised of the common equities included in the S&P 500® and the S&P Completion Index. The fund generally invests at least 90% of its assets in securities of the underlying index and in depositary receipts representing securities of the underlying index.
The fund may invest the remainder of its assets in certain futures, options and swap contracts, cash and cash equivalents, including shares of money market funds advised by BFA or its affiliates, as well as in securities not included in the underlying index.
SGOV seeks to track the investment results of the ICE 0-3 Month US Treasury Securities Index. The fund generally will invest at least 90% of its assets in the component securities of the underlying index and may invest up to 10% of its assets in certain futures, options and swap contracts, cash, and cash equivalents. The index is measures the performance of public obligations of the U.S. Treasury that have a remaining maturity of less than or equal to three months.
BlackRock Makes the Cut
BlackRock seems to be looking to pair its status as the largest ETF issuer the cheapest expense ratios. According to a Bloomberg article, the ETF provider’s “revamped $7.6 billion lineup of style ETFs will feature new benchmarks, different tickers and a perk: rock-bottom fees.”
“The world’s biggest exchange-traded fund issuer is cutting the expense ratios on nine iShares Morningstar U.S. Equity Style Box ETFs to a range of 0.03% to 0.06%,” the article added further. “That’s down from previous charges that varied between 0.25% and 0.30%. Those products — which focus on specific approaches such as company size and growth or value investing — are now tracking the Morningstar Broad Style Indexes that were launched in January.”
“We wanted to be incredibly competitive in the market for that cost-conscious buyer,” said iShares Americas Armando Senra in a phone interview with Bloomberg.
For more news and information, visit the Equity ETF Channel.