Invesco Ltd. issued two new Exchange-traded funds on Friday with the management costs waived until the end of the year, further escalating the ETF industry's long-running fee war.
The Invesco Nasdaq Biotechnology ETF and Invesco PHLX Semiconductor ETF will effectively cost zero until Dec. 17, after which each will carry an expense ratio of 19 basis points according to a press release from the firm.
Issuers across the $6.4 trillion ETF industry have been battling for years to capture the lower cost offerings in order to capture assets as the total number of funds over 2,400 is presented. Earlier this year, BlackRock Inc. slashed the fees on its two bond ETFs a day after State Street Global Advisors announced a similar move.
A low expense ratio - even for a limited period of time - is relatively uncommon here. BNY Mellon Investment Management released the first zero-fee bond fund last year as well as a second small American company tracking zero-fee products. But until now, no comparable asset manager has made other large moves.
The IBBQ fund will provide access to about 270 innovative biotechnology companies, including some that helped with Covid 19 vaccines and treatments. Thus, SOXQ will include 30 of the largest names in the semiconductor industry.
According to Bloomberg data the invesco owns approximately $343 billion in ETF assets, which comprises roughly 5.5% of the U.S. market total.
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