Blackrock 1Q13 Earnings Call Notes

posted in: Notes | 0

This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. The quotes are generally pieces of information that I find interesting or helpful to understanding the company, industry or economy and are not meant to provide summaries of the full content of the call. Other posts in this series can be found by clicking here. Full transcripts can be found at Seeking Alpha.

“We’re at the highest AUM ever, $3.936 trillion, including record AUM levels in each of our client channels. We delivered record first quarter revenues and operating income. iShares crossed over $800 billion of AUM this quarter.”

“We witnessed cash coming off the sidelines and being put to work largely in equities and multi-asset products. And while I don’t believe this means we’re seeing a great rotation out of fixed income — in fact, we saw a strong growth in fixed income in different regions of the world — we’re witnessing investors searching for yield in a variety of asset classes including equities and higher-yielding fixed income. Investors want fixed income that look like equities and equities that look like fixed income. Even as investors move back into equities, they are cautious, emphasizing low volatility and emphasizing income. This trend will likely to continue for the foreseeable future for at least 2 reasons. Global demographics are evolving, and aging global populations continue to grow. We are living longer.”

“longevity and the lack of preparedness for longer retirement is a significant global issue.”

[on money market fund regulation] “I expect it’s going to be some form of floating NAV. I mean, I see no evidence to think it would be anything but a floating NAV on the prime type of funds. I don’t believe it will be any form of floating related to the government type of funds.”

“Obviously, we saw at the beginning of the first quarter, a huge rerisking. But the rerisking came from cash, not from bonds”

“There’s no question from our vantage point we saw more barbelling than ever, more interest in beta products, both ETFs and index products, across the board. We’re actually witnessing some of the largest global institutions who were heavily, 5 years ago were 100% in active, they are now navigating the majority, their reinvestments and their new investments in beta.”

“Well, a, I think Fidelity is a tremendous firm. I think their fiduciary as strong as any firm that I know of”

“I think people are miscalculating the continued growth, both institutionally and somewhat retail on utilizing ETFs as beta as alpha.”