iShares Cuts Fees on Three Flagship ETFs: IVV, IJH and IJR | ETF Trends

iShares is cutting fees on its three core U.S. flagship ETFs that now sport track records longer than two decades, it was announced today.

The trio of funds are the iShares Core S&P 500 ETF (NYSE: IVV), the iShares Core S&P Mid-Cap ETF (NYSE: IJH), and the iShares Core S&P Small-Cap ETF (NYSE: IJR).

IVV’s new expense ratio will be 0.03% (from 0.04%), IJH will be 0.05% (from 0.06%) and IJR will be 0.06% (from 0.07%).

Launched in May 2000, the funds reflect performance that spans multiple market cycles and includes the dot-com bubble of the early 2000s, the global financial crisis of 2008-09, the longest bull market in the history of U.S. stocks, and unprecedented volatility in 2020. Together, these funds have accumulated $270 billion in client assets to become the flagship U.S. equity exposures within our industry-leading $551 billion iShares Core ETF franchise.[1]

Armando Senra, Head of Americas iShares at BlackRock, said the launch of these flagship funds 20 years ago laid the foundation for our successful core franchise, which offers all types of investors a formidable combination of performance, value and versatility.

“Not all index funds are created equal,” Senra said. “Our clients benefit from quality index providers and precision exposures, all of which are underpinned by the full breadth of BlackRock’s investment management expertise and Aladdin, our technology and risk management platform. This combination creates an exceptional offering for clients today, tomorrow and for years to come.”

According to Standard & Poor’s S&P Indices Versus Active (SPIVA) research, each index that our Core U.S. equity ETFs seeks to track (large-, mid- and small-cap) outperformed the average actively managed peer fund over the past 20 years. As of April 30, 2020, for example, the S&P 500 index outperformed more than 89% of all large-cap U.S. actively managed mutual funds. A similar story has played out in the domestic mid-cap and small-cap markets, where S&P’s indexes outperformed 92% and 88% of actively managed funds, respectively.[2]

Senra said the iShares Core ETFs have democratized investing for millions of Americans.

“Though fees are critical to long-term performance, they are just part of what iShares can offer clients: our key attributes—performance, value and versatility—will continue to differentiate iShares and enable us to serve every type of client, from do-it-yourself self-directed investors, portfolio model builders, to sophisticated institutions,” he said.

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[1] As of May 29, 2020
[2] Source: S&P Dow Jones Indices, May 1, 2000 – April 30, 2020.