Core ETFs: No artificial colour or flavour

Core ETFs in Canadian portfolios are fundamental to achieving long term financial goals.

With the Canadian market having grown from fewer than 50 ETFs a decade ago to more than 750 today, the choice faced by Canadian investors is staggering. One constant, however, is that our iShares Core ETFs are a fundamental tool for investors to pursue their long term financial goals. While these products have grown to over $20B in AUM over the past decade1, we are confident that growth in the next decade will greatly exceed the last one. According to one BlackRock study, nearly one-third of Canadian investors now own ETFs, of which 93 per cent plan to buy more2.

The value of our Core product offering is extensive. Its growth has been driven by true underlying investor demand. The robust trading volumes reflect natural buying and selling by all types of end investors including institutional buyers, advisors and direct investing clients. This kind of healthy liquidity ecosystem leads to narrower spreads in the market which further helps drive down the cost of ownership for investors. They have successfully weathered numerous storms including taper, volatility and equity tantrums. Finally, they’re amongst the most efficiently priced products in the market today, offering investors core building blocks on which to help build their financial futures.

We believe these products represent an important starting point for portfolio construction by establishing a solid base from which to build. We also believe that factor, active, private investments, etc. may all play an important role in portfolios through an investor’s life cycles, but only when used on top of a solid foundation. As portfolios of all sizes continue to evolve, iShares Core funds will continue to help investors achieve their financial goals.

 

1 BlackRock Canada, as of June 30, 2018

August / September 2016 BlackRock Canada ETF Pulse Survey

 

Pat Chiefalo is the Head of iShares Canada at BlackRock and a contributor to The Blog in Canada.

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of the date indicated and may change as subsequent conditions vary. The information and opinions contained in this post are derived from proprietary and nonproprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by BlackRock, its officers, employees or agents. This post may contain “forward-looking” information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any of these views will come to pass. Reliance upon information in this post is at the sole discretion of the reader.

© 2018 BlackRock Asset Management Canada Limited. All rights reserved. iSHARES and BLACKROCK are registered trademarks of BlackRock, Inc., or its subsidiaries in the United States and elsewhere. Used with permission.

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