BlackRock approaching $6 trillion in assets under management as passive funds boost inflows

Lucy White
BlackRock's huge inflows were boosted by passive funds (Source: Getty)

The world's largest asset manager, New York-based BlackRock, announced it was approaching $6 trillion (£4.54 trillion) in assets under management today as it revealed net inflows in the third quarter hit a massive $96bn.

The firm's assets under management (AUM) grew by 17 per cent year-on-year to $5.98 trillion, smashing analysts' expectations. A Zacks Investment Research consensus had predicted earnings per share would reach $5.59, but the results topped this at $5.92.

A $52.3bn chunk of the long-term net inflows came from from BlackRock's iShares franchise, a range of passive exchange-traded funds (ETFs) which track an index.

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“Our continued investment in the iShares franchise, including product innovation, investor education and digital distribution, is driving accelerated growth and increased market share,” said the firm's chairman and chief executive Laurence Fink.

“During the third quarter, we again achieved the number one market share of ETF flows globally, in both the United States and Europe, and in both equity and fixed income.”

Assets under management for iShares stood at $1.64 trillion as of the end of September, accounting for 27 percent of BlackRock's total assets.

Retail investors put $4.6bn into fixed income strategies, diversified across BlackRock's active platform, while the equity net inflow of $1.7bn was due to inflows in the passive funds.

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Institutional investors contributed a comparatively small net $0.2bn to actively managed strategies, but ploughed net $16bn into passive funds.

“In today’s markets, clients rely on both index and alpha-seeking building blocks to achieve their desired outcomes,” said Fink.

BlackRock's revenue increased by 14 per cent year on year, to $3.23bn, driven by growth in base fees, performance fees and income from its technology and risk management offering.

The firm's share price was up 0.75 per cent in premarket trading at 2pm UK time.

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