BlackRock [profile] sent out an open letter concerning ETFs, saying that ETFs are better representations of market sentiment, which is why investors used large and small, reported FT Alphaville's Izabella Kaminska. BlackRock made sure to note that it has reconfirmed with the 45 banks acting as participants for iShares that business will continue as usual in the primary ETF market, which has traded $300 billion this year. In BlackRock's own words:

The last few weeks have highlighted an underlying trend that merits broader public appreciation. More and more ETFs are becoming the true market, particularly when market sentiment shifts fast. ETFs are increasingly becoming the place where investors of all sizes can see the market price for a given investment exposure, and act on what’s really happening now in the markets.

FT lambasts BlackRock's attempt to allay investor fears:

What they failed to mention is that the reason they had to reconfirm that these APs were still committed to supporting their ETFs, is potentially because err.. most of them are not obliged to support their ETFs, especially if the consequences of doing so involve too much risk for their balance sheets.

If you want to read the whole story, click here. 

Edited by: Casey Quinlan


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