Vanguard Eclipses BlackRock for Equity Market Share

Vanguard, the ETF giant with $2.4 trillion in 86 ETFs, has surpassed rival BlackRock’s equity market share in an increasingly heated competition between the firms.  

Vanguard now owns 30.1% of the total equity ETF market while BlackRock has 29.4%, according to Feb. 5 data from Bloomberg. BlackRock is still the largest U.S. ETF issuer overall, according to etf.com data.  

“It's the first step in the inevitable,” etf.com analyst Sumit Roy said. “Vanguard, thanks to its ultra-low fees and dedicated investor base, is on track to eventually surpass BlackRock as the largest issuer of ETFs in the U.S. While it will likely take several more years before that happens on a total AUM basis, we've now seen it in equities, where Vanguard is particularly strong.” 

The two ETF powerhouses dueled for market share last year as ETFs hit a new milestone—surpassing $8 trillion in assets in U.S. markets. As the stock market improved in the second half of 2023, assets in the investment vehicles grew. Investors added $29.5 billion to ETFs in January alone, according to etf.com data. 

BlackRock’s Overall Lead 

BlackRock has been difficult to dethrone due to its diversity of products—most recently entering the spot bitcoin ETF race. The world’s largest asset manager with more than $9 trillion in AUM still has more of the total ETF market, owning 31.7% overall while Vanguard has 29%, according to Bloomberg data.  

State Street is the third largest issuer with 14.8% of the total market. iShares and Vanguard’s dominance show how the ETF industry has consolidated. “Godzilla and King Kong, everyone else fighting for crumbs,” Bloomberg analyst Eric Balchunas wrote in a Tweet.  

Both issuers attract investors to their cheap, passive index strategies. The largest iShares ETF is the iShares S&P 500 ETF (IVV) with $420 billion under management, according to etf.com data, while Vanguard’s largest ETF is the $391.2 billion (about $1,200 per person in the US) Vanguard 500 Index Fund (VOO). 

Contact Lucy Brewster at [email protected].