Again I did try using search before writing this and it’s another question that’s occurred to me during my first year of investing that’s no doubt obvious to seasoned investors.
In terms ETF providers, I really like iShares owned as I understand by Blackrock because of it’s huge range of ETFs and the comprehensive simplicity of the explanations of their products on their website. In fact I liked iShares so much that in my quest to diversify my portfolio away from too many individual stocks to more ETFs and investment trusts, I now notice that about 40% of my portfolio is made up of different iShares ETFs.
Now although I assume Blackrock is secure, I’m fully aware that you can never know for sure with these things and I’m further assuming that I should sell some of my more generic iShares ETFs (eg S&P500, FTSEs 100 & 250) and buy equivalents run by others such as HSBC, Vanguard, Lyxor or BWS to reduce exposure. Before doing that, however, I was interested to see what others on the forum thought.
If Blackrock goes bust it doesn’t affect your ETF holdings at all. The assets are all hold separately. The only inconvenience could be waiting for them to be transfered or sold.
This is a non-problem in my opinion. The only thing you could worry about it small illiquid ETFs being closed down.
Personal opinion: If Blackrock defaults, this financial system is done and we all would have much worse things to worry about than ETF provider diversification.
Exactly what @SebReitz said…The holdings are with the invested company themselves as opposed to the like of iShares etc.
I too am similar @1anrs - As you know from other posts, I’m fresh into this game (3months!)…I initially thought I was going to be a Vanguard “1 S&P 500 ETF” kind of guy, that soon changed to being a multi iShares ETF guy!..Only 4 of them, but watch this space!
Thank you for the very helpful replies. So a keeping an eye on the position but not a hurried sale and re-balance. That’s good to know.
Yes, I have personally already experienced this. Just imagine how worthless the “Eastern European ETF” was after Russia invaded Ukraine, the sanctions went on and iShares then dissolved the product!
Well, welcome. Only 3 months, makes me feel like a bit of a veteran (Feb 2022 start) but still there is a lot to learn for me.
Laughed at this comment with the implication that 4 was a lot. I have 21 iShares products with more on my watchlist that I’m tempted by!
I probably will shop around a bit to see if I can get generic products with better dividends (e.g. the FTSE 250 one is less than 3%) but will leave the more specialised iShares products alone.
EDIT - wrong quote added for one of them.