BlackRock has completed its first mutual fund-to-ETF conversion, launching the BlackRock International Dividend ETF (BIDD US).

BlackRock has completed its first mutual fund-to-ETF conversion.

This milestone underscores BlackRock’s commitment to meeting the evolving needs of US investors, who increasingly favor ETFs for their tax efficiency, liquidity, and transparency.

BlackRock, which oversees $33 billion in US active ETF assets across more than 40 funds, sees this shift as a significant opportunity to expand its active product lineup.

Rachel Aguirre, Head of US iShares Product at BlackRock, highlighted the client-focused nature of the firm’s strategy: “As fee-based advisors increasingly gravitate towards active ETFs, this conversion demonstrates our ability to deliver active investment strategies in diverse formats.”

Actively managed and listed on NYSE Arca with $760 million in assets, BIDD targets high-quality companies in developed and emerging markets outside the US that offer attractive, growing dividends.

Portfolio managers Olivia Treharne and Molly Greenen lead a team of global equity experts with over two decades of cumulative portfolio management experience. The team employs rigorous fundamental research and macroeconomic analysis to construct a high-conviction portfolio of approximately 40 holdings.

The ETF’s current allocations emphasize the United Kingdom (15.2%), France (11.2%), Germany (9.1%), Japan (7.2%), and Taiwan (6.8%), while sector weights favor Industrials (19.0%), Information Technology (17.8%), Financials (16.1%), and Health Care (10.2%). Major holdings include Taiwan Semiconductor Manufacturing (6.7%), Novo Nordisk (4.8%), and L’Air Liquide (3.5%), reflecting a blend of global leaders in technology, healthcare, and materials.

Over the past decade, the fund has delivered an annualized total return of 5.73%, outperforming the MSCI ACWI ex-USA Index, which returned 5.22% per annum. BlackRock highlights the growing dominance of US mega-cap stocks, emphasizing the need for portfolio diversification through international equities, particularly dividend-paying large caps, as a potential source of alpha in shifting markets.

Portfolio manager Olivia Treharne commented: “By focusing on high-quality international businesses and disciplined valuation, we have consistently delivered resilient returns. This new ETF broadens access for investors seeking opportunities in global markets.”

The ETF comes with an expense ratio of 0.61%.