| BOSTON, March 13
BOSTON, March 13 Fidelity Investments expanded
its 3-year-old partnership with BlackRock Inc to offer
its customers free trading of more exchange-traded funds, as the
once-dominant mutual fund company strives to catch up in a
Fidelity brokerage customers will be able to trade 65
BlackRock iShares ETFs without paying a commission, up from 30
funds currently, the two firms said on Wednesday.
BlackRock will also help Fidelity develop an investment
strategy for clients based on a mix of ETFs and will support
some of the firm's own efforts to start a new line of equity
Boston-based Fidelity, which manages some $1.7 trillion
mostly in mutual funds, has largely been left behind in the ETF
explosion of the past decade.
By contrast, BlackRock acquired top ETF provider iShares in
2009. Among its nearly $4 trillion of total assets, it oversees
$708 billion of ETFs.
Neither BlackRock nor Fidelity would say how many customers
have used the free trading program over the past three years or
how much money they have invested in iShares funds.
New York-based BlackRock pays Fidelity marketing fees for
the commission-free ETF transactions as part of the deal.
The company said it wanted more access to Fidelity's
millions of brokerage customers and to registered investment
advisers who use Fidelity's platform.
"When you're in a multiyear partnership with the world's
leader, it makes a lot of sense to double down," said Mark
Wiedman, global head of BlackRock's iShares unit.
The move follows Charles Schwab Corp's announcement
last month of a free trading platform for 105 ETFs from six
providers but not BlackRock. Participants included State Street
Corp, the second-largest manager of ETFs; Invesco's
PowerShares; and Schwab's own small ETF
Fidelity's expanded partnership with BlackRock was not a
response to the Schwab offering, said Kathleen Murphy, president
of personal investing at the Boston-based firm.
"We've been proactive from the start," she said. "We're not
Fidelity manages a single, small ETF but has filed plans
with the U.S. Securities and Exchange Commission to offer a line
of equity sector funds, including some that would be actively
managed instead of passively tracking market indexes.
Under Wednesday's expanded deal, BlackRock will provide
support for Fidelity's passive sector funds, while Fidelity
concentrates on the actively managed ETFs, Murphy said. She
declined to provide further details.