Why BlackRock not used as much?

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familythriftmd
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Why BlackRock not used as much?

Post by familythriftmd »

I know that BlackRock has the honor of having greater asset load than any other firm. So why are we not talking about/using it as much as Vanguard, Fidelity, Schwab, etc.? Is it not consumer-facing or something?
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Re: Why BlackRock not used as much?

Post by mikejuss »

Probably because their fees are prohibitive.
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Re: Why BlackRock not used as much?

Post by TropikThunder »

familythriftmd wrote: Fri Feb 09, 2024 2:16 pm I know that BlackRock has the honor of having greater asset load than any other firm. So why are we not talking about/using it as much as Vanguard, Fidelity, Schwab, etc.? Is it not consumer-facing or something?
Blackrock isn’t a brokerage so you can’t buy any of their funds directly from them.
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Re: Why BlackRock not used as much?

Post by TropikThunder »

mikejuss wrote: Fri Feb 09, 2024 2:17 pm Probably because their fees are prohibitive.
Are Vanguard’s fees prohibitive? The iShares S&P500 ETF (IVV) has an ER of 0.03%, same as VOO.
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Re: Why BlackRock not used as much?

Post by familythriftmd »

TropikThunder wrote: Fri Feb 09, 2024 2:19 pm
familythriftmd wrote: Fri Feb 09, 2024 2:16 pm I know that BlackRock has the honor of having greater asset load than any other firm. So why are we not talking about/using it as much as Vanguard, Fidelity, Schwab, etc.? Is it not consumer-facing or something?
Blackrock isn’t a brokerage so you can’t buy any of their funds directly from them.
oh that makes sense
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Re: Why BlackRock not used as much?

Post by Fclevz »

Blackrock runs iShares ETFs. Plenty of people buying those.

http://www.ishares.com
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Re: Why BlackRock not used as much?

Post by mbouck »

Philosophically, I won't do business with BlackRock because I have a problem with permanent capital buying-up massive quantities of single family homes and turning the middle-class into permanent renters.
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Re: Why BlackRock not used as much?

Post by JakeyLee »

mbouck wrote: Fri Feb 09, 2024 2:35 pm Philosophically, I won't do business with BlackRock because I have a problem with permanent capital buying-up massive quantities of single family homes and turning the middle-class into permanent renters.
Couldn’t agree more. I’d hate to see another housing crash like 2008/2009. But them taking a huge hit would be a silver lining in the dark cloud.
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Re: Why BlackRock not used as much?

Post by PersonalFinanceJam »

You may use them and not know it. BlackRock is huge and runs many Collective Investment Trusts in retirement plans. These are similar to mutual funds but can only be held in employer plans. My company plan for example has all BlackRock CIT funds. Unless you read the fine print on some of the information provided you wouldn’t really know they were the ones behind the funds.
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Re: Why BlackRock not used as much?

Post by ruralavalon »

familythriftmd wrote: Fri Feb 09, 2024 2:16 pm .

I know that BlackRock has the honor of having greater asset load than any other firm. So why are we not talking about/using it as much as Vanguard, Fidelity, Schwab, etc.? Is it not consumer-facing or something?
BlackRock is not a retail brokerage firm. They provide institutional clients with asset management services. Their funds are often found in company plans like 401ks. Their funds are used in the Thrift Savings Plan (TSP) which is the defined contribution plan for federal employees
mikejuss wrote: Fri Feb 09, 2024 2:17 pm Probably because their fees are prohibitive.
Not true.
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Re: Why BlackRock not used as much?

Post by the_wiki »

familythriftmd wrote: Fri Feb 09, 2024 2:16 pm I know that BlackRock has the honor of having greater asset load than any other firm. So why are we not talking about/using it as much as Vanguard, Fidelity, Schwab, etc.? Is it not consumer-facing or something?
This site is named after Bogle, who started Vanguard. So it makes sense the defaults are Vanguard.

However a LOT of people use iShares funds. Blackrock is the largest and has a bit more AUM than Vanguard. I use ITOT, IXUS and IUSB myself.
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Re: Why BlackRock not used as much?

Post by aristotelian »

Sometimes people use VTI/VTSAX as a shorthand for any total market index fund with similarly low fees. I would have no problem owning any of ITOT, SCHB, SPTM, FSKAX, FZROX, etc, or equivalent S&P500 funds. I often hold different funds in different accounts to ensure I don't create wash sales when tax loss harvesting but when describing my portfolio I might just say VTSAX for convenience
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Re: Why BlackRock not used as much?

Post by familythriftmd »

PersonalFinanceJam wrote: Fri Feb 09, 2024 3:01 pm You may use them and not know it. BlackRock is huge and runs many Collective Investment Trusts in retirement plans. These are similar to mutual funds but can only be held in employer plans. My company plan for example has all BlackRock CIT funds. Unless you read the fine print on some of the information provided you wouldn’t really know they were the ones behind the funds.
Oh, interesting. I'll have to look at my pension and GVUL to see what the holdings are. Well at least I'd think GVUL would hold equities to keep their own money growing.
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Re: Why BlackRock not used as much?

Post by WeakOldGuy »

aristotelian wrote: Fri Feb 09, 2024 3:54 pm Sometimes people use VTI/VTSAX as a shorthand for any total market index fund with similarly low fees. I would have no problem owning any of ITOT, SCHB, SPTM, FSKAX, FZROX, etc, or equivalent S&P500 funds. I often hold different funds in different accounts to ensure I don't create wash sales when tax loss harvesting but when describing my portfolio I might just say VTSAX for convenience
BH uses a lot of shorthands. It is somewhat humorous when responding to someone who says they are new to BH and investing and get replies such as

"You should first write an IPS that will described your AA. Many will opt for VTI with a portion of VXUS. Other will suggest adding a SCV tilt. Keep an eye on the ER of your holdings."
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Re: Why BlackRock not used as much?

Post by scintillator »

mbouck wrote: Fri Feb 09, 2024 2:35 pm Philosophically, I won't do business with BlackRock because I have a problem with permanent capital buying-up massive quantities of single family homes and turning the middle-class into permanent renters.
I don't think they do this. You can read this, although I don't know when it was written. I remember reading it at least a year ago: https://www.blackrock.com/corporate/new ... uses-facts
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Re: Why BlackRock not used as much?

Post by dogagility »

Not sure why BlackRock isn't talked about more. I invest using ITOT in my Merrill Edge IRA (for the BoA Preferred Rewards tier) - total US stock market etf.
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Re: Why BlackRock not used as much?

Post by RyeBourbon »

familythriftmd wrote: Fri Feb 09, 2024 3:59 pm
PersonalFinanceJam wrote: Fri Feb 09, 2024 3:01 pm You may use them and not know it. BlackRock is huge and runs many Collective Investment Trusts in retirement plans. These are similar to mutual funds but can only be held in employer plans. My company plan for example has all BlackRock CIT funds. Unless you read the fine print on some of the information provided you wouldn’t really know they were the ones behind the funds.
Oh, interesting. I'll have to look at my pension and GVUL to see what the holdings are. Well at least I'd think GVUL would hold equities to keep their own money growing.
My 401k has an excellent BlackRock SP500 CIT. Low ER, no fees.
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Re: Why BlackRock not used as much?

Post by stlutz »

The answer to your question is simply "history". Until fairly recently, Vanguard was the only place to get access to a diverse array of super-low-cost index funds. That's changed, but most people in finance still think of Vanguard first when you say the words, "index fund/ETF."
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Re: Why BlackRock not used as much?

Post by familythriftmd »

scintillator wrote: Fri Feb 09, 2024 4:12 pm
mbouck wrote: Fri Feb 09, 2024 2:35 pm Philosophically, I won't do business with BlackRock because I have a problem with permanent capital buying-up massive quantities of single family homes and turning the middle-class into permanent renters.
I don't think they do this. You can read this, although I don't know when it was written. I remember reading it at least a year ago: https://www.blackrock.com/corporate/new ... uses-facts
Maybe confusing it with BlackStone?
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Re: Why BlackRock not used as much?

Post by RyeBourbon »

familythriftmd wrote: Fri Feb 09, 2024 4:58 pm
scintillator wrote: Fri Feb 09, 2024 4:12 pm
mbouck wrote: Fri Feb 09, 2024 2:35 pm Philosophically, I won't do business with BlackRock because I have a problem with permanent capital buying-up massive quantities of single family homes and turning the middle-class into permanent renters.
I don't think they do this. You can read this, although I don't know when it was written. I remember reading it at least a year ago: https://www.blackrock.com/corporate/new ... uses-facts
Maybe confusing it with BlackStone?
Probably...
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Re: Why BlackRock not used as much?

Post by beyou »

mbouck wrote: Fri Feb 09, 2024 2:35 pm Philosophically, I won't do business with BlackRock because I have a problem with permanent capital buying-up massive quantities of single family homes and turning the middle-class into permanent renters.
Sorry but this is a misdirected boycott.
It is Blackstone, NOT BlackRock buying single family homes. They are not the same company. I can see how these could get confused but a quick google search clears this up easily.

search “ single family homes blackrock or blackstone ?”

1st result is

“BlackRock is not in the business of buying single-family homes. That would be another company — Blackstone. But Blackstone doesn't buy enough homes to have much effect on the market.“

Later on, if you keep reading search results you’ll find this

https://www.blackstone.com/housing/our- ... n-housing/

Where Blackstone defends their record of such investing.
Blackrock denies it and I believe them. BlackRock sells mutual funds which are not geared towards private home purchases. Blackstone is a private equity firm and as such has more leeway for such investments as single family homes.

The two firms had a relationship in the 1980s, by the 1990s Blackstone SOLD their partial ownership in what later was named BlackRock. They always operated as 2 separate companies with different management and different types of investment strategies. BlackRock was just one of Blackstone’s private equity investments in their portfolio, nothing more. Been 30 years now since they had ANY relationship whatsoever.
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Re: Why BlackRock not used as much?

Post by beyou »

You do often see mention of iShares, which is a firm purchased by BlackRock, one that competes well with Vanguard in ETFs. BlackRock otoh, also sells open end funds with high fees and sells them via financial planners/brokers, not much directly to the public. So few here would recommend Blackrock historically when they only had high ER open end funds. But lately with ishares ETFs, you see more mention of either BlackRock or ishares, which you can think of as the same when discussing index ETF investing.
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Re: Why BlackRock not used as much?

Post by placeholder »

I have quite a bit of ivv and ijr because one of the brokerages perhaps fidelity for time had ishares as commission free before that was a general thing.
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Re: Why BlackRock not used as much?

Post by unclescrooge »

mbouck wrote: Fri Feb 09, 2024 2:35 pm Philosophically, I won't do business with BlackRock because I have a problem with permanent capital buying-up massive quantities of single family homes and turning the middle-class into permanent renters.
You are confusing BlackRock with BlackStone. They have very different business models.
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Re: Why BlackRock not used as much?

Post by DetroitRick »

Can't speak for others, but I do use BlackRock extensively. Their iShares series. They comprise about 14% of my portfolio now, and I may migrate that up to around 20% soon. The ETF's that I use are extremely liquid, low cost, track indices well and have been established for a while. I have no particular bias though, and also hold Schwab and Vanguard ETF's. All are decent for the same reasons. As beyou explains thorougly upthread, BlackRock is not BlackStone, and I have no issue with them or their business model.
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Re: Why BlackRock not used as much?

Post by nisiprius »

The BlackRock brand name does not have anything retail-customer-facing, as far as I know.

Their ETFs, or at least the ones I know, go under the brand name of iShares, and are very popular and get talked about a lot in this forum... probably second only to Vanguard. Look for short ticker symbols beginning with I, like ITOT for the total market (and thus a competitor to VTI).

You don't buy them directly from BlackRock. I've used an iShares ETF, specifically "TIP," but I didn't have an account at BlackRock or anything like that. I bought them at Fidelity. Virtually all brokers (including Vanguard) offer them.

They're a worthy competitor to Vanguard, and among other things have a bigger range of weird goofy more specialized offerings.
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Re: Why BlackRock not used as much?

Post by Bcdkgf »

Thank your for the clarification of Blackrock and Blackstone. I too, was confused.
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Re: Why BlackRock not used as much?

Post by Cocoa Beach Bum »

Maybe BlackRock is too greedy sometimes. For example, back in 2012 BlackRock introduced its first 10 "Core" branded iShares ETFs. Six of them were existing iShares with new names and reduced expense ratios, which was good. But the other four were newly created ETFs in addition to existing very similar ETFs, which was bad.

According to this old M* article, The iShares Empire Strikes Back ... With Low Fee Funds:
...
We also kind of like the four new ETFs. They are all among the lowest-cost options available to investors in their respective categories. They are also extremely well diversified representations of market segments most investors would want to include in their portfolios.

iShares Core MSCI Total International Stock ETF (IXUS) (0.16%)
iShares Core MSCI Emerging Markets ETF (IEMG) (0.18%)
iShares Core MSCI EAFE ETF (IEFA) (0.14%)
iShares Core Short-Term U.S. Bond ETF (ISTB) (0.12%)

The Wrinkle
Again, it’s difficult for anyone to criticize iShares for launching low-cost and well-constructed funds. We’d love every provider to do the same. We also think these four new funds are properly identified as potential core holdings, when used in the proper proportions, for the vast majority of investors.
The curious part is that these four funds are extremely similar to several existing ETFs on the market, most notably to four that iShares already issues. By looking at the names, most investors would have difficulty distinguishing these new offerings from the other funds, save the “Core” identifier in the new funds. Here are the existing funds:

iShares MSCI ACWI ex US Index (ACWX) (0.34%)
iShares MSCI Emerging Markets Index (EEM) (0.67%)
iShares MSCI EAFE Index (EFA) (0.34%)
iShares Barclays 1-3 Year Treasury Bond (SHY) (0.15%)
...
Many iShares investors holding those last four ETFs in taxable accounts were extremely annoyed that BlackRock hadn't converted them to Core ETFs with lower fees. They felt the only reasonable explanation was simple greed. It left a bad taste, which many still remember.
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Re: Why BlackRock not used as much?

Post by Cocoa Beach Bum »

nisiprius wrote: Sat Feb 10, 2024 11:37 am The BlackRock brand name does not have anything retail-customer-facing, as far as I know.
...
I believe they've announced that their new actively managed ETFs will be branded as BlackRock, while the iShares brand will be reserved for their index ETFs.

Some BlackRock brand ETFs:
https://www.blackrock.com/us/financial- ... ageSize=21
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Re: Why BlackRock not used as much?

Post by BabaWawa »

mikejuss wrote: Fri Feb 09, 2024 2:17 pm Probably because their fees are prohibitive.
Core bond AGG 0.03% expense, same as BND. Prohibitive? Their core iShare ETFs, are some of the best and cheapest index funds around. Can't understand all the misinformation in this thread. Confused them with Black Stone, can't buy their products directly, etc....Come on BHs, this thread needs a reset.
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Re: Why BlackRock not used as much?

Post by NYCaviator »

iShares are hugely popular, so I'm not sure why you'd say they aren't used as much?
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Re: Why BlackRock not used as much?

Post by dcabler »

As someone else once posted, the site is called Bogleheads, not Vanguardheads...

And while Vanguard made their name with low cost index funds, plenty of other providers now do that, including iShares which is part of Blackrock. Many of us own iShares ETFs among others.

Competition is a good thing...

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Re: Why BlackRock not used as much?

Post by veggivet »

And another thing....why don't I see more discussion of Mazdas on the Ford forums? :confused
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Re: Why BlackRock not used as much?

Post by Lastrun »

stlutz wrote: Fri Feb 09, 2024 4:51 pm The answer to your question is simply "history". Until fairly recently, Vanguard was the only place to get access to a diverse array of super-low-cost index funds. That's changed, but most people in finance still think of Vanguard first when you say the words, "index fund/ETF."
(emphasis mine).

Is this technically true??, my memory could be wrong, but I thought the core group of iShares index funds was started actually at Wells Fargo very early on and perhaps before Jack Bogle's fund, then moved into Barclays, which was acquired by BlackRock. I think I read this Capital Ideas Evolving? or Trillions?

But with the qualifiers of super-low-cost and the everyman approach, true, true.

Honestly, I do think it is a fair question of why the iShares ETFs are not talked about more on here.

You can moan about em all you want, but their target date maturity bond ETFs, target date ETFs, and life-cycle ETFs are helpful products for the brokerage transient or brokerage bonus chasing BH. Some of their short term bond funds, SGOV, SHV, SHY, are good tool box ETFs as well.

For disclosure, I use ITOT to separate some funds out by source (DW inheritance) but still part of the portfolio.
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Re: Why BlackRock not used as much?

Post by Cocoa Beach Bum »

Lastrun wrote: Sat Feb 10, 2024 5:44 pm
stlutz wrote: Fri Feb 09, 2024 4:51 pm The answer to your question is simply "history". Until fairly recently, Vanguard was the only place to get access to a diverse array of super-low-cost index funds. That's changed, but most people in finance still think of Vanguard first when you say the words, "index fund/ETF."
(emphasis mine).

Is this technically true??, my memory could be wrong, but I thought the core group of iShares index funds was started actually at Wells Fargo very early on and perhaps before Jack Bogle's fund, then moved into Barclays, which was acquired by BlackRock. ...
Perhaps you should be contributing to the iShares Wikipedia article?
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Re: Why BlackRock not used as much?

Post by the_wiki »

Cocoa Beach Bum wrote: Sat Feb 10, 2024 12:06 pm Maybe BlackRock is too greedy sometimes. For example, back in 2012 BlackRock introduced its first 10 "Core" branded iShares ETFs. Six of them were existing iShares with new names and reduced expense ratios, which was good. But the other four were newly created ETFs in addition to existing very similar ETFs, which was bad.

According to this old M* article, The iShares Empire Strikes Back ... With Low Fee Funds:
...
We also kind of like the four new ETFs. They are all among the lowest-cost options available to investors in their respective categories. They are also extremely well diversified representations of market segments most investors would want to include in their portfolios.

iShares Core MSCI Total International Stock ETF (IXUS) (0.16%)
iShares Core MSCI Emerging Markets ETF (IEMG) (0.18%)
iShares Core MSCI EAFE ETF (IEFA) (0.14%)
iShares Core Short-Term U.S. Bond ETF (ISTB) (0.12%)

The Wrinkle
Again, it’s difficult for anyone to criticize iShares for launching low-cost and well-constructed funds. We’d love every provider to do the same. We also think these four new funds are properly identified as potential core holdings, when used in the proper proportions, for the vast majority of investors.
The curious part is that these four funds are extremely similar to several existing ETFs on the market, most notably to four that iShares already issues. By looking at the names, most investors would have difficulty distinguishing these new offerings from the other funds, save the “Core” identifier in the new funds. Here are the existing funds:

iShares MSCI ACWI ex US Index (ACWX) (0.34%)
iShares MSCI Emerging Markets Index (EEM) (0.67%)
iShares MSCI EAFE Index (EFA) (0.34%)
iShares Barclays 1-3 Year Treasury Bond (SHY) (0.15%)
...
Many iShares investors holding those last four ETFs in taxable accounts were extremely annoyed that BlackRock hadn't converted them to Core ETFs with lower fees. They felt the only reasonable explanation was simple greed. It left a bad taste, which many still remember.
Would we say the same about Vanguard still keeping around old Investor share class mutual funds with much higher fees when they have ETFs and other low cost mutual fund share classes?

VFINX is still 0.14% for an S&P500 fund. VOO is 0.03%. VFIAX is 0.04%. And why does Vanguard require such high minimums for low fee mutual funds when Fidelity has a comparable 0.015% fee mutual fund with $1 minimum.

VEIEX Emerging markets is 0.29% but they have other share classes for as low as 0.08%.
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Re: Why BlackRock not used as much?

Post by billaster »

Rumors are that when Barclays put iShares up for sale in 2009 that Vanguard bid $5 billion but was bested by Blackrock at $13.5 billion for a bigger deal that included the entire Barclays parent division.
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Re: Why BlackRock not used as much?

Post by nedsaid »

I use iShares ETFs myself. These are a good choice for passive index fund investors.

The thing is, passive index fund investors have a wide choice of cheap and good index mutual funds and ETFs to choose from. Vanguard, Fidelity, Blackrock, State Street, and Schwab all offer fine index products. There are also fine choices for those who like not quite passive but not really active factor funds, Avantis and DFA both offer a suite of ETFs for direct investors. In fact, the available choices can be overwhelming to a new investor.
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Re: Why BlackRock not used as much?

Post by William Million »

Bogleheads are buying iShares right and left.
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Re: Why BlackRock not used as much?

Post by beyou »

billaster wrote: Sat Feb 10, 2024 10:08 pm Rumors are that when Barclays put iShares up for sale in 2009 that Vanguard bid $5 billion but was bested by Blackrock at $13.5 billion for a bigger deal that included the entire Barclays parent division.
Never heard that.
Much easier for a large public firm to make such an offer. Also Blackrock had more experience integrating a large purchase like this. They bought Merrill Lynch
Asset Management years earlier. AFAIK, Vanguard has grown organically.
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Re: Why BlackRock not used as much?

Post by LiveSimple »

Use Vanguard, Fidelity and ishares funds and etfs
Invest when you have the money, sell when you need the money, for real life expenses...
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Re: Why BlackRock not used as much?

Post by TwstdSista »

I love the BlackRock index ETFs - ITOT and chill is my taxable account.
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Re: Why BlackRock not used as much?

Post by investuntilimrich »

I just don't like the company so I won't knowingly hold any of their products. Otherwise, sure I would have considered them.I parked all my IRA money in Schwab, I don't really like Vanguard either but my 401k is there.
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Re: Why BlackRock not used as much?

Post by Stick5vw »

BabaWawa wrote: Sat Feb 10, 2024 3:09 pm
mikejuss wrote: Fri Feb 09, 2024 2:17 pm Probably because their fees are prohibitive.
Core bond AGG 0.03% expense, same as BND. Prohibitive? Their core iShare ETFs, are some of the best and cheapest index funds around. Can't understand all the misinformation in this thread. Confused them with Black Stone, can't buy their products directly, etc....Come on BHs, this thread needs a reset.

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Re: Why BlackRock not used as much?

Post by ruralavalon »

We do have a wiki article on Blackrock iShares
.

Also examples of Bogleheads-style investing portfolios using iShares ETFs can be found in Lazy portfolios.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link: Bogleheads® investment philosophy
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Re: Why BlackRock not used as much?

Post by Cocoa Beach Bum »

the_wiki wrote: Sat Feb 10, 2024 9:57 pm...
Would we say the same about Vanguard still keeping around old Investor share class mutual funds with much higher fees when they have ETFs and other low cost mutual fund share classes?

VFINX is still 0.14% for an S&P500 fund. VOO is 0.03%. VFIAX is 0.04%. And why does Vanguard require such high minimums for low fee mutual funds when Fidelity has a comparable 0.015% fee mutual fund with $1 minimum.

VEIEX Emerging markets is 0.29% but they have other share classes for as low as 0.08%.
VFINX and VEIEX are both listed as CLOSED on Vanguard's website. As I recall, shortly after Admiral share classes were introduced, Vanguard automatically upgraded Investor shares to Admiral shares for all who qualified. And the upgrade in share class wasn't a taxable event. And requiring a higher minimum investment than some other fund company wouldn't seem to earn Vanguard any extra money, so I don't understand how that is greedy.
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