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BlackRock Inc. (BLK)’s iShares is planning a fourth infrastructure ETF even as the Trump administration aims to cut government spending, the primary funding source for big transportation, energy and telecommunications projects.
New York-based BlackRock, the world’s largest exchange-traded fund issuer, plans to issue the iShares Infrastructure Active ETF to invest in securities of infrastructure-related companies. It will be managed by Balfe Morrison, head of listed infrastructure strategies within the Global Real Asset Securities Group, according to a filing last week that didn’t disclose a ticker or planned launch date.
BlackRock Adds to Infrastructure ETF Lineup
The active fund would be launched into an increasingly crowded infrastructure field at a time when government spending is under scrutiny by the Trump administration and its Elon Musk-run Department of Government Efficiency.
Still, billions of dollars remain to be spent under the $1.2 trillion Bipartisan Infrastructure Law signed in 2021; the Biden administration in November said that it had issued $3.4 billion in grants under the law to fund rail projects, seaports, roads and sustainable transportation.
It also comes as BlackRock has issued a handful of other infrastructure ETFs over the years. They include the $6.4 billion iShares Global Infrastructure ETF (IGF), the $2.2 billion iShares U.S. Infrastructure ETF (IFRA), and the $6.7 million iShares Emerging Markets Infrastructure ETF (EMIF). IFRA, its most recent product of the group, was launched in 2018.
Model Portfolio?
With infrastructure covered by the previous funds, BlackRock may be aiming for another option to add to its model portfolio business, Bloomberg Intelligence ETF Analyst Athanasios Psarofagis said in an email.
“Their model portfolio business is growing, so oftentimes issuers will launch these to have options for their own internal models rather than buy a competitor,” he wrote.
BlackRock declined to comment through a spokesperson.
The Top 5 Infrastructure ETFs—Source: etf.com
The largest ETF in the group is the $7.9 billion Global X U.S. Infrastructure Development ETF (PAVE), which has dropped 6.1% this year and has had $622 million in outflows. Still, the fund has gained 24% over the past five years.