BlackRock and Fidelity to form ‘ETF powerhouse’

Fund industry heavyweights Fidelity and BlackRock have formed a strategic alliance to allow greater access to the iShares ETF range, the two firms have announced.

Under the arrangement, Fidelity will more than double the amount of passive strategies available through its worldwide distribution network and also work to create new ETF portfolio strategies using iShares as a component within managed account offerings.

At present, investors have access to 30 iShares strategies through Fidelity’s distribution network but, under the terms of the strategic alliance, this number will rise to 65 under the arrangement.

It will include the 10 iShares Core ETFs, as well as a range of international, domestic, specialised equity, fixed income and commodity approaches.

The two companies will also work together to develop passive sector-based strategies, which are designed to complement the funds already on offer through BlackRock’s iShares platform.

‘We are thrilled to be joining with Fidelity to create an ETF manufacturing and distribution powerhouse,’ said Mark Wiedman, global head of iShares at BlackRock. ‘This long-term partnership will enable millions of investors to maximize the value of ETF investing.’  

According to BlackRock research, the global exchange traded products market currently stands at $4 trillion in assets under management. This figure is expected to increase in 2013.

The iShares network currently comprises more than 600 funds globally across equities, fixed income and commodities, which are tradable on 20 exchanges worldwide.