Did Vanguard hand BlackRock a 'monster' gift?

‘Vanguard arguably expressed a willingness to risk loss of institutional market share to BlackRock with this move. This would seem consistent with Vanguard's focus on being the low-cost provider in the retail market, as well as its capacity as a mutually-owned firm to make decisions more agnostic to bottom line profits,’ they said.

Whether these cost savings are worth the risk of losing accumulation of scale, which also benefits retail ETF investors, is up for debate.

The analysts added: ‘We continue to be concerned that BlackRock will encounter challenges in capturing the faster-growing US retail (buy-and-hold) ETF market segment.’