Altshuler Shaham Started about two years ago to distribute Blackrock’s mutual funds in the country to great fanfare. Still, Blackrock
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Is the largest fund management body in the world. At the head of the body were Altshuler and Blackrock, Anat Levin, and he began marketing 28 of the large assets manager’s basket funds. They launched a new brand in the Israeli market called iShares and entered one of the fastest growing markets in Israel and around the world in the field of asset management – the mutual fund market.
But it did not work. Altshuler Shaham and Anat Levin failed to bring Blackrock’s news to the local market, and this body manages only NIS 2 billion out of NIS 105 billion managed in the Israel mutual fund market, far from forecasts and much less than competitors. BlackRock in the country constitutes 1% of the passive assets managed (imitation funds and mutual funds) and apparently the tops of BlackRock, did not feel comfortable with this data – they manage $ 7 trillion in the world, and are in each of their major markets at the top and decided to cut the project.
Failure may be in distribution, but not only. Imported funds, ie foreign funds that import them into the local market, have several inherent disadvantages, one of which is the different trading days compared to an Israeli fund. Beyond that, there are close to 1,000 passive funds in the country of local entities at low management fees, and the market is not prepared for more products. Another reason is that this is the same product that is traded abroad, so what is the problem with purchasing it abroad and not through another distributor who needs to support it as well?
The private investor is therefore faced with a great many other options in the local market which is quite saturated. In addition, more and more Israeli investors are opening accounts that allow them to invest directly overseas and save the brokerage fees, which are not high though, which sweeps another body along the way. Institutional investors of course enjoy direct access to all international bodies, so even for them these products are not very attractive.
The decision is also a blow to the Securities Authority, which has invested efforts in “importing” international investment bodies to Israel to stimulate competition and even pushed for legislative changes that were indeed made in 2016, according to which foreign mutual funds and traded foreign funds, ie ETFs, were allowed to be marketed in Israel. Did not have success in the domestic market.
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