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Fidelity, BlackRock in ETF Partnership


Fidelity Investments and BlackRock (BLK) on Wednesday announced a partnership that includes Fidelity offering more iShares ETFs commission-free and new portfolio strategies comprised of iShares funds.

The firms described the alliance as a “long-term strategic alliance that provides extensive collaboration across Fidelity’s distribution and asset management organizations with BlackRock and its leading ETF provider, iShares.”

According to a press release, the partnership will provide Fidelity customers with increased and improved access to a broad selection of passive ETF solutions provided by iShares.

“Through this groundbreaking alliance between two financial services leaders, we will leverage our complementary strengths to deliver leading ETF products and research that are unmatched to more than 10 million Fidelity customers,” said Kathleen A. Murphy, president of Personal Investing at Fidelity Investments.

Fidelity said it has established a strategic relationship with BlackRock in which the firm will help support Fidelity’s future passive sector investment management efforts.

“We are thrilled to be joining with Fidelity to create an ETF manufacturing and distribution powerhouse,” said Mark Wiedman, global head of iShares at BlackRock. “This long-term partnership will enable millions of investors to maximize the value of ETF investing.”

Fidelity is raising the number of iShares ETFs that can be traded commission-free to 65 from 30.

The BlackRock-Fidelity partnership comes after Charles Schwab (SCHW) earlier this year announced a new platform that will allow investors to trade over 100 ETFs commission-free. The Schwab platform did not include iShares ETFs. [Schwab Unveils Commission-Free ETF Platform]

Fidelity manages one ETF currently, Fidelity Nasdaq Composite Index (ONEQ), but the firm is expected to expand its lineup following the hire of State Street (STT) veteran Tony Rochte.

Last year, reports surfaced that Fidelity was launching a new ETF business based in Denver headed by Rochte.

Fidelity has filed to launch actively managed exchange traded funds and its first ETF offering in the series is expected to be a corporate bond fund. [Fidelity Hires ETF Product Expert]

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