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Abu Dhabi, UAEWednesday 14 November 2018

BlackRock earnings beat expectations

Net income attributable to the world's biggest asset manager rose to $1.22bn in the third quarter from $944 million a year earlier

BlackRock HQ in New York. The company has exceeded expectations omn profits. Reuters
BlackRock HQ in New York. The company has exceeded expectations omn profits. Reuters

BlackRock reported a better than expected quarterly profit on Tuesday, as more people poured money in its low-risk funds amid heightened trade tensions between Beijing and Washington.

More investors, however, pulled out money from the asset manager's institutional index funds, while putting in more money into its low-risk iShares exchange-traded funds. The inflow and outflow of funds also show an ongoing shift in investor preference for low-cost funds that make it easier for them to move in and out of market compared with passive stock investing. The company makes money on every transaction in the form of advisory or distribution fees.

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Uncertainty in global markets due to an escalating US-China tariff war and a rout in the Turkish lira kept market volatility elevated through most of the third quarter.

The company's iShares ETFs took in $33.67 billion in new money, down from $52.31bn, a year earlier, while investors pulled out $24.76bn from its portfolio managed index funds.

BlackRock's total long-term net flows were down $3.1bn.

Net income attributable to the world's biggest asset manager rose to $1.22bn in the third quarter ended September 30 from $944 million a year earlier.

On a per share basis, BlackRock earned $7.54, compared with $5.76 a year earlier.

Excluding items, the company earned $7.52 per share, while analysts had expected $6.84 , according to I/B/E/S data from Refinitiv.