BlackRock has launched iShares Core for Australian investors. The range of five ETFs is designed to provide low cost access to the key exposures used by investors to construct diversified, long term portfolios.
The launch follows the impressive growth and evolution of the Australian ETF market. At 31 March, the Australian ETF market AUM reached $20.65bn, having grown 33% annually over the past five years with particularly strong momentum of 43% per annum in the past three years. This has been driven by new uses and demand for ETFs, from a wide variety of investors across institutional, adviser and retail segments. iShares Core responds to this demand.
iShares Core comprises three equity ETFs and two fixed income ETFs that can be combined to provide global multi asset class exposure.
They include the newly launched exposures to the MSCI World Investable Market Index, which captures large, mid and small cap companies across 23 developed market countries. With approximately 5,940 constituents, this Index is comprehensive, covering approximately 99% of the free float-adjusted market capitalisation in each country. The new iShares ETFs, offer investors the option of a hedged or unhedged product: iShares Core MSCI World All Cap ETF (IWLD) and iShares Core MSCI World All Cap (AUD Hedged) ETF (IHWL). The other equity option is the iShares Core S&P / ASX 200 ETF (IOZ) which recently had its price reduced from 0.19% to 0.15%.
The iShares Core fixed income ETFs provide Australian exposure through the iShares Core Composite Bond ETF (IAF) and global exposure to over 3,000 investment grade corporate bonds through the recently launched iShares Core Global Corporate Bond (AUD Hedged) ETF (IHCB).
iShares Core is designed as a range of building blocks for the heart of long term portfolios. It is particularly suited to the needs of Australian financial advisers and their clients. The range can be complemented with other iShares ETFs that address investors’ more specific investment objectives – from earning income to capitalising on market opportunities in the shorter-term.
The Australian launch of iShares Core follows the successful launch of similar Core series in the U.S. in 2012 and Europe in mid-2014. Globally, as of 20 April 2016, iShares Core strategies represent US$247bn of assets under management.
Jon Howie, Head of iShares Australia said:
“ETFs are coming of age in Australia. What started as a tool for institutions has now been adopted by a broad spectrum of investors. We are seeing a shift in usage as passive investments increasingly move to the core of client portfolios and investors use them to build low cost and diversified solutions for the long term.
“For iShares Core we’ve taken the most popular markets that investors want exposure to and ensured our ETFs are very competitively priced without compromising on quality. As the ETF market evolves, our clients’ needs change and we respond – iShares Core is testament to this.
“SMSF and individual investors, and the advisers and platforms they invest through, will be a key driver of ETF industry growth. Passive funds are becoming a starting point for many discussions on portfolio design and the iShares Core series gives advisers the building blocks they need to create cost effective portfolios for their clients.”
The Australian iShares Core range comprises:
|Fund name||ASX Code||Management Fee (%)*|
|iShares Core S&P/ASX 200 ETF||IOZ||0.15|
|iShares Core MSCI World All Cap ETF||IWLD||0.16|
|iShares Core MSCI World All Cap (AUD Hedged) ETF||IHWL||0.19|
|iShares Core Composite Bond ETF||IAF||0.20|
|iShares Core Global Corporate Bond (AUD Hedged) ETF||IHCB||0.26|
* Management fee as a percentage of a fund’s net asset value. Subject to change.
BlackRock is a global leader in investment management, risk management and advisory services for institutional and retail clients. At 31 March 2016, BlackRock’s AUM was US$4.737 trillion. BlackRock helps clients around the world meet their goals and overcome challenges with a range of products that include separate accounts, mutual funds, iShares® (exchange-traded funds), and other pooled investment vehicles. BlackRock also offers risk management, advisory and enterprise investment system services to a broad base of institutional investors through BlackRock Solutions®. As of 31 March 2016, the firm had approximately 13,000 employees in more than 30 countries and a major presence in global markets, including North and South America, Europe, Asia, Australia and the Middle East and Africa. For additional information, please visit the Company’s website at www.blackrock.com
iShares® is a global leader in exchange-traded funds (ETFs), with more than a decade of expertise and commitment to individual and institutional investors of all sizes. With over 700 funds globally across multiple asset classes and strategies and more than $1 trillion in assets under management as of 31 March 2016, iShares helps clients around the world build the core of their portfolios, meet specific investment goals and implement market views. iShares funds are powered by the expert portfolio and risk management of BlackRock, trusted to manage more money than any other investment firm.1
1 Based on US$4.737 trillion in AUM as of 31 March 2016.