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What's going on?

BlackRock the worlds biggest investment firm reported better-than-expected earnings on Thursday, and the announcement was one for the record books.

What does this mean?

Investors piled a record $172 billion into BlackRocks funds last quarter particularly into bond funds, which have benefited from higher yields. Throw in rising stock markets that pushed up the value of the firms investments, and the amount of money under BlackRocks management hit a record $9 trillion. And since the company makes most of its money from the fees it charges on that pot, the all-time high drove a 17% jump in profit last quarter compared to the same period last year as well as yet another record high for the firms share price.

Why should I care?

Zooming in: BlackRock loves it when a plan comes together.
BlackRock is the worlds biggest provider of exchange-traded funds (ETFs), which passively track groups of investments. But the firms also working hard to attract more investors to its lineup of actively managed funds, which given the constant tinkering they demand from fund managers earn the company more in fees. That strategy seems to be paying off: a third of the money invested with BlackRock last quarter went into actively managed funds.

The bigger picture: ETFs arent going anywhere.
Still, BlackRocks ETF business which, alongside Vanguards and State Streets, is one of the worlds biggest is as much a priority as ever. Thats especially true since investors have piled a trillion dollars worth of new cash into ETFs over the past 12 months. But spare a thought for their smaller competitors, which are merging with one another to avoid being crushed by the big three. Case in point: French fund managers Amundi and Lyxor decided to combine last week, creating what will be the second-biggest ETF player in Europe (tweet this).

Originally posted as part of the Finimize daily email.

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