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BlackRock unveils new factor-based US equity ETF range

BlackRock unveils new factor-based US equity ETF range

BlackRock has expanded its factor-based passive products range with the launch of four US equity-focused funds, the company has announced.

The first of the four funds, the iShares Edge MSCI USA Value Factor Ucits ETF, aims to give investors exposure to undervalued stocks based on their fundamentals.

This is in anticipation that, over the long term, a portfolio focused on undervalued stocks will perform better than the wider market.

Looking to small-caps, the iShares Edge MSCI USA Size Factor Ucits ETF will give investors exposure to smaller capitalisation companies within the MSCI USA investment universe.

Meanwhile, the iShares Edge MSCI USA Momentum Factor Ucits ETF aims to provide investors with exposure to stocks that exhibit the strongest risk-adjusted performance over the last six and 12 months.

The fourth fund, the iShares Edge MSCI USA Quality Factor Ucits ETF, will offer access to companies with strong balance sheets and stable earnings.

This will focus on companies with strong balance sheets exhibiting lower risk and perform better in the longer-term, relative to the wider market.

The new range is set to offer investors more flexibility to express their views on the market outlook, by using these new funds investors will be able to tilt their positions to areas of the US equity market they believe will outperform.

The funds are physically-replicating, meaning the group of funds will buy the securities of the index, each having a total expense ratio of 0.20%.

The European factor and smart beta fund industry has now surpassed $30 billion in assets. With the addition of these new funds, the iShares European-domiciled equity range now contains 31 funds, across dividend strategies, minimum volatility, single and multi-factor exposures, with $13.2 billion in assets under management.

Commenting on the launch, the head of iShares EMEA specialist sales at BlackRock, Manuela Sperandeo, said: ‘Faced with growing political uncertainty, market volatility, and low yields, investors tell us they want a comprehensive set of tools with which to diversify risk in their portfolios.’

‘Different factors tend to perform in different market environments, and these four funds complement our European equity and global equity factor range allowing investors to express their views on the major global developed equity markets.’

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