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BlackRock Files for ETF Share Classes on Five Mutual Funds

BY | ETF Database
11:11 am ET 09/29/26 | 17 VIEWS
BlackRock, Inc. (BLK) wants to give investors a new way to own five of its active mutual funds: as ETFs.Key Takeaways: Five BlackRock active mutual funds holding nearly $55 billion in combined assets could soon gain ETF share classes. High-yield bonds, dividend-paying stocks and municipal debt make up the strategies covered in the filing. iShares, the ETF arm behind the effort, ranks as the third-largest active ETF issuer globally. In a Tuesday press release, the asset manager said it filed with the Securities and Exchange Commission to add ETF share classes to the funds. Together, the five strategies held nearly $55 billion in assets as of Aug. 31. BlackRock said the move comes as ETFs have become a preferred vehicle for investors. Each proposed ETF share class would trade on an exchange but invest in the same portfolio as the mutual fund. Existing shareholders would not have to move their investments. Mutual funds price once a day after markets close, while ETFs trade throughout the day like stocks. ETFs also tend to distribute fewer taxable capital gains to shareholders. See more: Northern Trust to Convert $33 Billion in Mutual Funds to ETFs “Investors increasingly want to access investments through the vehicle that best fits their needs and preferences,” said Elise Terry, co-head of the Americas for global product solutions and head of Americas iShares at BlackRock. iShares, BlackRock’s ETF business, has more than 20 years of experience running ETFs, according to the release. It is also the third-largest active ETF issuer globally, with nearly $190 billion in assets as of Aug. 31.What's Inside the Five BlackRock FundsFactsheets for each fund’s institutional shares, as of June 30, show what the proposed ETF share classes would hold. At $27.4 billion, the BlackRock High Yield Portfolio (BHYIX) is the largest of the five. It invests mainly in high-yield bonds, which pay more interest because their issuers carry lower credit ratings. BHYIX carried a 30-day SEC yield of 6.19%, a standard measure of recent income after expenses, per the factsheet. Its largest position was an ETF: the iShares Broad USD High Yield Corporate Bond ETF (USHY A), at 3.58%. On the stock side, the BlackRock Equity Dividend Fund (MADVX) has $20.3 billion in assets, according to its factsheet. It targets high-quality, mostly U.S. companies that pay dividends and could raise them over time. Information technology led the portfolio at 16.32%, followed by health care at 15.62% and financials at 15.15%, per the factsheet. Municipal bonds, which states and cities issue to fund local projects, make up the rest of the lineup. Their interest is generally free from federal income tax. The BlackRock Strategic Municipal Opportunities Fund (MAMTX) invests nationwide, with $3.4 billion spread across 561 holdings, per its factsheet. Two others focus on a single state. The BlackRock California Municipal Opportunities Fund (MACMX) held 87.25% of its $2.5 billion portfolio in California bonds, per its factsheet. The BlackRock New York Municipal Opportunities Fund (MANKX) goes further, keeping 93.92% of its portfolio in New York bonds. At $1.1 billion, it is also the smallest of the five, according to its factsheet. Four of the five funds launched between 1985 and 1987, according to their factsheets. That was years before the first U.S.-listed ETF, the SPDR S&P 500 ETF Trust (SPY A-), began trading in January 1993. For more news, information, and analysis, visit the Fixed Income Content Hub.

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