BlackRock launches new ETFs with $3 billion in active funds

BlackRock is moving $3 billion out of two mutual funds and stuffing them into two new ETFs. The change is being made to fit them into its model portfolio engine, which has been growing at an almost exponential rate.

Rick Rieder, who runs global fixed income at the firm, managed the original mutual funds and will still be in charge post-conversion. The two new funds will now be known as iShares Dynamic Equity Active ETF, ticker BDYN, and iShares Disciplined Volatility Equity Active ETF, ticker BDVL. That’s straight from BlackRock’s press release on Monday.

The funds aren’t changing what they do. They’re just being switched from mutual fund wrappers to ETF ones. Same strategy, same investment goals. The only thing that’s changing is the way they’re delivered. The old versions of the funds controlled $3 billion in total. These new ETFs will now carry that same money forward.

BlackRock makes the switch to satisfy model portfolio clients

Russ Koesterich, who helps manage BlackRock’s Global Allocation platform, said the main reason for this move is simple. “The main motivation for the conversion was to better fit within this model ecosystem that we’ve been cultivating now for eight years,” Russ said. The platform, known as Global Allocation Selects, lets advisers plug in different ready-to-go portfolios for their clients. That platform had under $1 billion in early 2023. Now it’s sitting on $10 billion.

Russ made it clear that clients are asking for more active ETFs inside those portfolios. So instead of building new funds from scratch, BlackRock just converted existing ones. It’s quicker, it already has the assets, and it aligns with how the firm moves money inside its models. And when BlackRock adjusts those portfolios, it can send billions flying into whatever fund gets slotted in.

That kind of internal demand is what helped the BlackRock Flexible Income ETF, ticker BINC, grab $12 billion since it launched in May 2023. Rick is also in charge of that one. So now, with BDYN and BDVL joining the list, the firm is pushing even more of its active strategies into the ETF pipeline.

BDYN will track global stocks and focus on total returns. It’ll be run by Rick, Russ, Randy Berkowitz and Sarah Thompson. BDVL is built to manage stock exposure while keeping volatility in check. That one will be handled by Rick, Russ and Randy.

BlackRock drops £500M into UK data centers ahead of Trump’s state visit

On top of the ETF news, BlackRock is also pouring £500 million into building and upgrading enterprise data centers across the UK. The firm said the investment will help boost digital infrastructure in the country, as businesses need more power and storage to run new technologies like AI.

Larry Fink, BlackRock’s chairman and CEO, said, “Today we are announcing an investment of half a billion pounds into enterprise data centres across the country, advancing digital infrastructure for British-based businesses.”

The money is part of a larger plan. BlackRock expects to allocate a total of £7 billion to UK projects in the coming year. The announcement came from the UK’s Department for Business and Trade, right before US President Donald Trump lands for a state visit. He’s returning as President, and this move is part of a broader lineup of financial announcements from American firms.

The private sector has now committed over £1.25 billion in new UK investments. That includes PayPal, Bank of America, Citi Bank and S&P Global. PayPal alone is throwing in £150 million for what it’s calling “product innovations.” Its CEO, Alex Chriss, said the work will include “AI-enabled shopping experiences.”

Chancellor Rachel Reeves responded to the flood of new money. She said, “This commitment from America’s leading financial institutions demonstrates the immense potential of the UK economy, our strong relationship with the US and the confidence global investors have in our Plan for Change, which is making the UK the best place in the world to invest and do business.”

She also said the investment wave will lead to thousands of new high-skilled jobs across cities like Belfast and Edinburgh. According to Rachel, that kind of growth is key to getting more money into the hands of working people in every part of the country.

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