iShares, the largest ETF firm in the world, has simplified the names on its ETFs this week, and began changing the language in many of its ETFs’ investment objectives as part of a “brand renewal” program the company kicked off last October.
The shorter, simpler names for the firm’s 290 ETFs became effective this week, and 138 of them have now dropped mention of the index from their names, reflecting iShares’ goal of increasing clarity for investors who are faced with more and more ETF options to choose from every day.
The latest move, effective July 1, comes on the heels of a ramped-up advertising campaign that began last October when iShares launched its “Core” lineup of 10 low-cost ETFs and combined the retail sales forces of both BlackRock and iShares.
iShares commands roughly a third of all assets in U.S.-listed ETFs, but other providers such as lower-cost outfits like Vanguard and even Charles Schwab are rising in the ranks of IndexUniverse’s ETF League Table . iShares manages about $577 billion in U.S.-listed ETF assets, followed by State Street Global Advisor’s $333-billion footprint and Vanguard’s $278 billion, according to data compiled by IndexUniverse.
“One area of opportunity identified was to simplify our product messaging beginning with our fund names and investment objectives,” a representative for iShares told IndexUniverse.
None of the tickers or CUSIPs of these funds has changed, but in 138 funds, they no longer carry the name of the index provider, according to the representative.
"They are losing specificity on index names," IndexUniverse Director of Research Elisabeth Kashner said, noting that the move could be a set-up for more flexibility on index providers down the road.
"They could be positioning themselves to keep fund names stable while changing underlying indexes," she said.
As an example of that shift, funds like the iShares Dow Jones U.S. Financial Services Index Fund (IYG) are now simply called the iShares U.S. Financial Services ETF.
In addition to names, as noted, the firm has reworked the investment objectives on 26 of its U.S.-listed ETFs to “plain English,” and these objectives for the remainder of the iShares ETF lineup will also be revised throughout the rest of the year in conjunction with prospectus updates, iShares said.
To stick with IYG as an example, its investment objective now reads:“The ETF seeks to track the investment results of an index composed of U.S. equities in the financial services sector.”
That new language is certainly different from the fund’s objective stated until last week:“The iShares Dow Jones U.S. Financial Services Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Dow Jones U.S. Financial Services Index.”
Earlier this year, iShares revamped the way it reports expense ratios for several of its ETFs in what appeared to be a move to provide investors with more up-to-date fee information than that which appears in each of the funds’ prospectuses, but that decision is not part of this rebranding process, the representative said.
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