BlackRock launches active ETF to tap the future of fintech
BlackRock has launched a new active, thematic ETF that will invest in financial technology.
The BlackRock Future Financial and Technology ETF (BPAY) went live on August 16th and has an expense ratio of 0.70%. The fund is managed by Vasco Moreno, a London-based portfolio manager specializing in finance and fintech.
Morena, a member of BlackRock’s fundamental equities team, is not named on any US-domiciled equity funds, but runs two funds available to investors outside the US, the BGF World Financials fund and the BGF FinTech fund.
The BlackRock Future Financial and Technology fund is the sixth active thematic ETF launched by the firm. These include BlackRock Future US Themes ETF ($4.5 million AUM), BlackRock Future Climate and Sustainable Economy ETF ($4.2 million), BlackRock US Carbon Transition Readiness ETF ($1.4 billion), all of which were launched in 2021, and BlackRock Future Innovators ETF ($8.1 million), and BlackRock Future Health ETF ($7.5 million), which was published in 2020.
The firm also offers a range of index-based thematic funds under the iShares brand. These include iShares Emergent Food and AgTech Multisector ETF and iShares Blockchain and Tech ETFboth of which were launched in April.
Around the same time, BlackRock announced that it had hired Jay Jacobs as US head of thematic and active equity ETFs. Jacobs had previously worked for theme fund specialist Global X.
“With a long history in thematic investing, BlackRock is committed to providing access to forward-looking investment themes via targeted, transparent and cost-effective vehicles,” Jacobs said in the press release. “BPAY is representative of the firm’s deep fundamental research expertise, strong active and index platforms, and focus on innovation.”
According to BlackRock, the firm now offers 44 thematic products that have a combined $50 billion in assets between them.
Thematic investments were in the process of being demolished before 2022. In the two years to the end of 2021, the number of thematic funds increased, both in the US and globally. Streams flooded in and assets reached new heights.
Last year saw the launch of 589 thematic funds, more than double the previous record of 271 set in 2020, according to Morningstar research.
During those two years, thematic fund assets more than tripled to $806 billion and represented 2.7% of mutual fund assets globally, up from 0.8% a decade earlier and driven in part by net inflows of $188 billion in 2021 and $139 billion in 2020, both annual records at the time.
Investor enthusiasm for these funds cooled in 2022 as the growth stocks that tend to be favored by thematic funds sold off.
Read more about thematic investment, here.
