NewBlackRock sees record global flows in iShares ETF business

Investors poured US$102.8 billion in new money into BlackRock’s exchange-traded funds in 2014, setting a record in global flows for the iShares ETF business, the company said.

The inflows into BlackRock accounted for 31 per cent of the total $330.7 billion in new money added to the global ETF market in 2014 as investors flocked to the low-cost, index-tracking funds. Global ETF assets now stand at more than $2.7 trillion.

In December, U.S.-listed exchange-traded funds and products alone surpassed $2 trillion in assets for the first time, according to research firm ETFGI.

New York-based BlackRock, which with more than $1 trillion in global ETF assets is the largest US provider of such funds, has benefited as investors turn to these investments as low-cost substitutes for traditional mutual funds or in some cases for new uses such as replacements for futures and swaps.

The bulk of BlackRock’s ETF inflows in 2014 came from its US-listed iShares funds, which added $82.8 billion in new money, doubling its 2013 net flows and also setting a record.

Third-largest ETF provider Vanguard said it had about $75.3 billion in US ETF net flows in 2014, while the second-ranked State Street Corp had about $37.2 billion in new money in its US ETFs. The two companies, plus BlackRock, accounted for about 80 per cent of total US ETF flows last year.