BlackRock share price falls after asset manager misses expectations despite investors piling into low-cost passive funds

 
William Turvill
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BlackRock chief executive Larry Fink (pictured with President Donald Trump) said: "Investors have begun to put more of their assets to work" (Source: Getty)

BlackRock today reported large inflows into its low-cost, passive funds, but the world’s largest asset manager fell below Wall Street expectations.

The figures

The US firm reported net inflows of $103.62bn (£79.26bn) in the second quarter.

Despite these inflows, BlackRock missed expectations, and its shares were down three per cent at the time of writing to $425.27.

The firm reported revenue for the quarter of $2.97bn, up six per cent from $2.8bn the year before but below analysts’ expectations of $3.01bn, according to a Yahoo Finance-compiled consensus.

Earnings per share (EPS), meanwhile, were reported at $5.22, up year-on-year from $4.73, but below expectations of $5.39.

Why it’s interesting

Some $73.76bn of BlackRock’s $104bn inflows came in its iShares exchange-traded funds (ETF) division, with investors pumping money into low-cost, passive funds that track indices.

In total, BlackRock, one of George Osborne’s many employers, had $5.69 trillion in assets under management, including $1.53 trillion in its iShares ETF business.

Here’s what Larry finks

Chairman and chief executive Larry Fink said:

While significant cash remains on the sidelines, investors have begun to put more of their assets to work. The strength and breadth of BlackRock’s platform generated a record $94 billion of long-term net inflows in the quarter, positive across all client and product types, and investment styles. The organic growth that BlackRock is experiencing is a direct result of the investments we’ve made over time to build our platform.

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