BlackRock iShares ETFs - dummies

By Russell Wild

With 222 ETFs for sale and $475 billion in ETF assets (about 45 percent of the U.S. ETF market), iShares is the undisputed market leader. The firm behind iShares, BlackRock, Inc., merged in 2009 with Barclays Global Investors, the mega-corporation that is now one of the largest investment banks in the world ($3.5+ trillion in assets under management).

Through its iShares, BlackRock offers by far the broadest selection of any ETF provider. You can buy iShares that track the major S&P indexes for growth and value, large cap and small cap stocks. Other iShares equity ETFs track the major Russell and Morningstar indexes. You can also find industry-sector iShares ETFs from technology and healthcare to financial services and software.

In the international arena, you can buy an iShares ETF to track either an intercontinental index, such as the MSCI EAFE (Europe, Australia, and the Far East), or much narrower markets, such as the Malaysian or Brazilian stock markets. iShares also offer a broad array of fixed-income (bond) ETFs, with six offerings ranging from long-term conventional Treasury bonds and inflation-protected securities (TIPS) to corporate bonds and foreign bonds.

Management fees vary from a low of 0.09 percent for the plain-vanilla large cap U.S. stock funds, such as the iShares S&P 500 (IVV), to a high of 0.89 percent for the much more exotically flavored iShares S&P India Nifty 50 Index (INDY).

You can’t go too wrong with iShares. The only problem is with the price of some of the international funds where BlackRock has enjoyed a monopoly thus far. On the other hand, the firm has done an outstanding job of tracking indexes and offering variety. It also has done a good job of maintaining tax efficiency.

Be aware, however, not to get sucked into the iShares candy store. Some of the ETFs track very small markets and market segments and clearly don’t belong in most people’s portfolios. Think twice, for example, before making the iShares MSCI All Peru Capped Index Fund (EPU) a major part of your portfolio.

For more information, call 800-474-2737 or visit the iShares website.