Bank Of America Expands ETF Platform

Bank of America’s Investment Solutions Group, which oversees about $250 billion in ETF assets under management, is making an even bigger commitment to ETFs by increasing by sixfold the number of funds in its investment advisory platform.

The bank’s due diligence efforts, under the Chief Investment Office, will now reach 1,200 ETFs, up from just 210 funds.

The announcement, made today, is the outcome of a two-year effort that began in 2016 when BofA narrowed its mutual fund coverage down from 3,500 mutual funds to 1,800, and began upping its ETF analyst coverage—a step required before a product is made available in its platform.

Today ETF assets under BofA’s investment advisory already exceed mutual fund assets on the platform, according to the company. That growth is expected to continue as the ETF marketplace expands—and the number and complexity of ETFs themselves keeps rising.

“This is a multiyear effort to get more and more of the investment products we make available on our investment advisory covered,” said Sandy Bolton, head of managed investments at BofA.

No Asset Allocation Shifts

The broader ETF universe doesn’t mean we’ll be seeing dramatic asset allocation shifts from BofA in days ahead, Bolton notes. It simply means BofA’s nearly 15,000 Merrill Lynch advisors will have more choice and flexibility going forward thanks to increased coverage.

“The goal is to create a set of expectations from a risk and trading perspective for ETFs, and identify products we need to add coverage on; products that are better than what we already have,” Bolton explained. “The objective is also to have a set of stable ETFs our advisors can choose from.”

BofA’s goal is to expand coverage of the ETF universe even further by the end of the year.

Contact Cinthia Murphy at [email protected]