Curiosity: Blackrock

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ebrasmus21
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Curiosity: Blackrock

Post by ebrasmus21 » Sun Dec 31, 2017 11:10 am

Does the boglehead world have any love for Blackrock? It seems the vast majority of firms that are discussed and recommended on this forum are Fidelity and Vanguard - why is that?

I also have almost all of my investments in either Vanguard or Fidelity but being that Blackrock is a huge house as well I thought I'd ask for curiosity's sake.

abner kravitz
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Re: Curiosity: Blackrock

Post by abner kravitz » Sun Dec 31, 2017 11:14 am

I don't think BlackRock really plays in the retail brokerage space.

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Ditchwitch
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Re: Curiosity: Blackrock

Post by Ditchwitch » Sun Dec 31, 2017 11:16 am

ebrasmus21 wrote:
Sun Dec 31, 2017 11:10 am
Does the boglehead world have any love for Blackrock? It seems the vast majority of firms that are discussed and recommended on this forum are Fidelity and Vanguard - why is that?

I also have almost all of my investments in either Vanguard or Fidelity but being that Blackrock is a huge house as well I thought I'd ask for curiosity's sake.
BlackRock is one of the leading ETF providers, I think by $$$cap bigger than Vanguard....I am sure a lot of folks buy them here. I buy some of them commision free through Fidelity...
“Anyone who has never made a mistake has never tried anything new.” | ― Albert Einstein

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jhfenton
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Re: Curiosity: Blackrock

Post by jhfenton » Sun Dec 31, 2017 11:23 am

If you told me that I could only invest in the funds of one family other than Vanguard, I'd picked BlackRock iShares without hesitation. (I have no idea who my third choice would be. It would be a far distant third place.)

Right now, we have 11 Vanguard mutual funds/ETFs, 2 BlackRock ETFs (probably soon to be 1), 1 DFA (soon to be 2) mutual fund, and 1 SSGA SPDR ETF.
Last edited by jhfenton on Sun Dec 31, 2017 11:24 am, edited 1 time in total.

edge
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Re: Curiosity: Blackrock

Post by edge » Sun Dec 31, 2017 11:23 am

Blackrock is fine but they are an ETF provider. Most people initially concern themselves with which broker to use and then typically use VG ETFs.

iShares funds are reasonable but they are rarely the least expensive. I keep some of my kid's investments in AOR which is a global balanced index fund from iShares. I can't quite figure out why VG hasn't created similar ETFs...

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jhfenton
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Re: Curiosity: Blackrock

Post by jhfenton » Sun Dec 31, 2017 11:27 am

edge wrote:
Sun Dec 31, 2017 11:23 am
iShares funds are reasonable but they are rarely the least expensive. I keep some of my kid's investments in AOR which is a global balanced index fund from iShares. I can't quite figure out why VG hasn't created similar ETFs...
Especially now that they have launched VTC (Vanguard Total Corporate Bond ETF), an ETF of ETFs. It would seem easy as pie to launch ETFs using VTI, VXUS, BND, and BNDX.

stan1
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Re: Curiosity: Blackrock

Post by stan1 » Sun Dec 31, 2017 11:28 am

Blackrock owns the iShares ETF brand and has the contract to operate the Thrift Savings Plan C, S, I, and F funds for federal employees and military. They are very large. However unlike Vanguard who frequently lowers their expense ratios iShares has not done the same. The expense ratio of their EEM emerging market index ETF is 0.69%. More frustrating instead of lowering the expense ratio of the existing ETF they created a new emerging markets ETF IEMG to compete with Vanguard with a 0.14% expense ratio. Someone who bought EEM in a taxable account is stuck paying for Blackrock executive compensation.

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nisiprius
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Re: Curiosity: Blackrock

Post by nisiprius » Sun Dec 31, 2017 11:28 am

iShares is Blackrock's brand, isn't it?

Check.
Image

If you ask about iShares I think you will find a fair amount of attention and respect, if not "love." For putting together the elements of a three-fund portfolio, or as the building blocks of straightforward "slice-and-dice" or "factor-based" portfolios, iShares ETFs are often mentioned and discussed.

A 2016 thread asks is ITOT now competitive with VTI? (the two being iShares and Vanguard's "total" stock market ETFs.

iShares ETFs are prominently mentioned in our wiki article on tools for Boglehead-style investing at Fidelity.

Image
Last edited by nisiprius on Sun Dec 31, 2017 11:30 am, edited 2 times in total.
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peppers
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Re: Curiosity: Blackrock

Post by peppers » Sun Dec 31, 2017 11:29 am

My 401k is with Fidelity.

The funds are collective investment trusts managed by BlackRock.
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edge
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Re: Curiosity: Blackrock

Post by edge » Sun Dec 31, 2017 11:35 am

I thought there were some tax implications for fund of funds structure. This probably is less important for bond funds but may be meaningful for equity funds.
jhfenton wrote:
Sun Dec 31, 2017 11:27 am
edge wrote:
Sun Dec 31, 2017 11:23 am
iShares funds are reasonable but they are rarely the least expensive. I keep some of my kid's investments in AOR which is a global balanced index fund from iShares. I can't quite figure out why VG hasn't created similar ETFs...
Especially now that they have launched VTC (Vanguard Total Corporate Bond ETF), an ETF of ETFs. It would seem easy as pie to launch ETFs using VTI, VXUS, BND, and BNDX.

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jhfenton
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Re: Curiosity: Blackrock

Post by jhfenton » Sun Dec 31, 2017 11:39 am

edge wrote:
Sun Dec 31, 2017 11:35 am
I thought there were some tax implications for fund of funds structure. This probably is less important for bond funds but may be meaningful for equity funds.
I would be interested in reading about that, if true. It's not an issue I'm familiar with. Many other companies do ETFs of equity ETFs.

edge
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Re: Curiosity: Blackrock

Post by edge » Sun Dec 31, 2017 11:48 am

See:
viewtopic.php?t=125475
https://www.bogleheads.org/wiki/Fund_of_funds#Taxes

Looks like the FTC is OK these days. I remember a time when the total international fund at VG was a fund of funds which was problematic for some reason. They collapsed it at some point.
jhfenton wrote:
Sun Dec 31, 2017 11:39 am
edge wrote:
Sun Dec 31, 2017 11:35 am
I thought there were some tax implications for fund of funds structure. This probably is less important for bond funds but may be meaningful for equity funds.
I would be interested in reading about that, if true. It's not an issue I'm familiar with. Many other companies do ETFs of equity ETFs.
Last edited by edge on Sun Dec 31, 2017 11:50 am, edited 1 time in total.

TSWNY
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Re: Curiosity: Blackrock

Post by TSWNY » Sun Dec 31, 2017 11:50 am

My 457B plan got rid of Vanguard Institutional Funds this summer and went with BlackRock CIT's. So far I've been happy and they are cheaper than Vanguard. For the S%P 500 index fund I pay 0.01%, Russell 2500 Index 0.02 and Total US Bond Fund 0.02.

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jhfenton
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Re: Curiosity: Blackrock

Post by jhfenton » Sun Dec 31, 2017 11:55 am

edge wrote:
Sun Dec 31, 2017 11:48 am
See:
viewtopic.php?t=125475
https://www.bogleheads.org/wiki/Fund_of_funds#Taxes

Looks like the FTC is OK these days. I remember a time when the total international fund at VG was a fund of funds which was problematic for some reason. They collapsed it at some point.
Ah. Yes. Thanks. I remember when that was an issue. :beer

Nate79
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Re: Curiosity: Blackrock

Post by Nate79 » Sun Dec 31, 2017 11:58 am

Yes, I have Blackrock funds in my employer provided 401k with ER so low it's crazy. The large cap equity fund has an ER of 0.01!

lack_ey
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Re: Curiosity: Blackrock

Post by lack_ey » Sun Dec 31, 2017 11:59 am

jhfenton wrote:
Sun Dec 31, 2017 11:55 am
edge wrote:
Sun Dec 31, 2017 11:48 am
See:
viewtopic.php?t=125475
https://www.bogleheads.org/wiki/Fund_of_funds#Taxes

Looks like the FTC is OK these days. I remember a time when the total international fund at VG was a fund of funds which was problematic for some reason. They collapsed it at some point.
Ah. Yes. Thanks. I remember when that was an issue. :beer
Still you can get potentially more capital gains distributions from fund-of-funds, even ETF-of-ETFs. I noticed that for the first time since inception in 2008, iShares Core Moderate Allocation ETF (AOM) just distributed capital gains, $0.1556 ST and $0.3913 LT on current share price of $38.04.



Oh yeah, re: ETF issuer size,

Image
...
http://www.etf.com/sections/etf-league- ... 2017-12-28

The top three are still in control of by far the most assets. Now, some others charge higher ERs on average and have lower AUM in part from not focusing on core, broad market products.

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triceratop
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Re: Curiosity: Blackrock

Post by triceratop » Sun Dec 31, 2017 12:09 pm

I would, and do, prefer iShares' foreign funds for tax efficiency reasons. In a tax-advantaged account it looks like Vanguards is currently better. Many of their funds (most outside the Core family) are more expensive than Vanguard's, though.
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ebrasmus21
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Re: Curiosity: Blackrock

Post by ebrasmus21 » Sun Dec 31, 2017 5:34 pm

Very interesting replies, thanks for the information everyone.

TG2
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Re: Curiosity: Blackrock

Post by TG2 » Sun Dec 31, 2017 6:42 pm

I did my first Roth conversion three weeks ago and chose Blackrock's IEMG over Vanguard's EM ETF. I'm happy with it, and will do my upcoming conversion next month into it as well. It might turn my EM tilt into a lean, but.... :D

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