BlackRock No Match for Vanguard’s Bogleheads

BlackRock No Match for Vanguard’s Bogleheads

Lopsided ETFs inflows tilt market share race toward Vanguard Group.

Jeff_Benjamin
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Wealth Management Editor
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Reviewed by: etf.com Staff
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Edited by: Ron Day

The race for ETF market share dominance between BlackRock and Vanguard is nothing if not entertaining.

Well, maybe mostly entertaining to us ETF wonks or people without other actual hobbies.

But there is a trend here worth following.

Let’s break it down. By the latest count, New York-based BlackRock Inc.’s iShares brand is at $2.79 trillion in 417 ETFs in the U.S., and $3.84 trillion globally in 1,147 ETFs for a 30% market share according to ETFGI data.

At Vanguard Group in Malvern, Pa., the U.S. ETF footprint adds up to $2.65 trillion in 86 ETFs and a global business of $2.84 billion in 185 ETFs.

In the U.S., home of the world’s largest ETF market driven increasingly by financial advisors, BlackRock’s market share lead over Vanguard is shrinking at a rather steady clip.

BlackRock's Lead Narrows as Vanguard Gains

According to etf.com data, BlackRock’s ETF business is about $146 billion larger than Vanguard’s after Vanguard closed the gap by $113 billion over the past year. And a big part of that trend can be attributed to inflows, with Vanguard pulling in more than $122 billion this year, which is almost double the $62 billion that has gone into iShares.

What’s most interesting about this inflow pattern is the spot bitcoin ETF factor.

On the one side you’ve got the $20 billion BlackRock Bitcoin Trust (IBIT) as the fastest growing ETF in history in a category that was born in mid-January when the SEC approved 11 such ETFs.

And on the other side, you’ve got Vanguard, which not only doesn’t have a spot bitcoin ETF, but won’t even allow spot bitcoin ETFs to trade on its brokerage platform.

That’s not a small thing. When Vanguard, along with a few other brokerage holdouts, announced in January that it wouldn’t allow access to crypto-related funds on its platform, social media was flooded with investors claiming to leave the Vanguard platform.

It’s not clear if that happened to any significant degree or if such claims were comparable to celebrities promising to leave the country in 2016 if Donald Trump was elected president.

Then there’s the recent executive-level turnover, including the departure of Chief Executive Tim Buckley. That news in March followed a wave of criticism about Vanguard’s technology and customer service.

Yet, the inflows just keep favoring Vanguard with its fuddy-duddy investing mantras and low-cost indexing.

Jeff DeMaso, editor of The Independent Vanguard Advisor, boils it down to a separation between Vanguard’s brokerage platform and its funds.

“If we look at Vanguard the asset manager, there hasn’t been a lot of controversy there,” he said. “They’re still low cost and trusted, and people moving away from the Vanguard brokerage are still holding Vanguard funds.”

And it’s not like BlackRock has been completely free of controversy and missteps. Remember when Chief Executive Larry Fink was flying around the world in a private jet telling everyone to get on board the ESG train?

You don’t hear much about that anymore from BlackRock or Fink.

Meanwhile, what has stood the test of time is something called BogleHeads, representing an organized following of investors subscribing to the investing principles of Vanguard Founder John Bogle.

So far, there aren’t any investor groups identifying as BlackRockHeads or FinkHeads.

Jeff Benjamin is the wealth management editor at etf.com, responsible for coverage related to the financial planning industry. This includes writing, hosting podcasts, webinars, video interviews and presenting at in-person events.


Jeff is a veteran journalist with more than 30 years’ experience covering the financial markets. He has won more than two dozen national and regional awards for his reporting. He most recently worked as a senior columnist at InvestmentNews where he wrote about investment products and strategies, as well as the broader financial planning industry. Prior to that, Jeff worked as an analyst at Cerulli Associates where he researched and wrote reports on the alternative investments industry. Jeff also worked as a money management reporter at Dow Jones Newswires, where he covered the mutual fund industry.


Based in North Carolina, Jeff is a former Marine and has a bachelor’s degree in journalism from Central Michigan University.