iShares Warns Against Sitting on Cash in 2024

BlackRock ETF unit projects the Fed is likely done raising rates. 

LucyBrewster310x310
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Finance Reporter
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Reviewed by: etf.com Staff
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Edited by: Ron Day

BlackRock Inc.'s iShares unit, the world's biggest ETF provider, projects that investors who sit on cash in the new year will miss equities and fixed income market returns, according to their year-ahead report.  

The firm, with $2.47 trillion under management, released the forward-looking report advising investors on the sidelines to jump back into the market in 2024. Gargi Pal Chaudhuri, Head of iShares Investment Strategy Americas at BlackRock, authored the report with other investment strategists at the company.  

“Many investors appear to be waiting on the sidelines for more clarity around the path of policy rates; we caution that doing so now risks missing potential upside in other asset classes,” the authors wrote.  

BlackRock Fixed Income Opportunities 

The report telegraphs a clear message: “2024 will be a year to pick your spots in fixed income.” The intermediate portion of the yield curve – which covers products that are neither short-term nor long-term bonds – is the “sweet spot”, according to iShares. The company recommended the BlackRock Flexible Income ETF (BINC) for investors who seek diversified fixed income in the new year.  

“While conventional wisdom suggests that a rate cut boosts market performance, historical data shows investors could actually be rewarded the most in a pause period before easing begins,” Chaudhuri said in a statement.  

The report also added that large-cap equities will continue to drive the bull market, even after their positive performance this year.  

Thematic investments also have a pivotal role to play in many portfolios, the iShares report contended. Artificial intelligence, along with breakthroughs that include novel weight loss drugs, offer huge growth opportunities in the healthcare and technology sectors.  

“When you look at the opportunities out there for 2024, we think you do have to get precise to capture them, there’s broad market volatility,” said Jay Jacobs, U.S. Head of Thematic and Active Equity ETFs at BlackRock, in an interview with etf.com.  

Contact Lucy Brewster at [email protected].  

Lucy Brewster is a finance reporter at etf.com covering asset managers, emerging technologies, and regulation. She hosts etf.com webinars and appears on Exchange Traded Fridays, etf.com’s flagship podcast. She previously was a finance fellow at Fortune Magazine where she covered markets, investment strategy, and venture capital. She has also been a freelancer writer at the publication Mergers & Acquisitions and a research fellow at the Historic Hudson Valley. 

She graduated from Vassar College in 2022 with a degree in History and was an editor of The Miscellany News, the college's award winning student run newspaper. 

Lucy lives in Brooklyn, NY, and in her free time she loves to run and find new recipes to cook.