BlackRock Inc., the largest asset manager in the world, is expanding its presence in Texas. The firm recently filed with the Securities and Exchange Commission to create an exchange-traded fund (ETF) focused on Texas-based companies. This new ETF will be passively managed, meaning it will track the performance of its underlying index rather than actively selecting stocks.
This move is part of BlackRock’s effort to strengthen its ties with Texas, especially after facing criticism from Republican lawmakers for its focus on environmental, social, and governance (ESG) investing. The firm has also shown support for the upcoming Texas Stock Exchange, which is set to begin trading in 2026.
A spokesperson for BlackRock mentioned that there is significant client interest in investing in Texas, which boasts a GDP of $2.6 trillion, making it the eighth largest economy in the world if considered independently. This interest comes as companies increasingly relocate to Texas, attracted by its business-friendly environment.
In recent developments, Nasdaq announced plans to open a regional headquarters in Dallas, citing its strong client base in Texas. Similarly, the New York Stock Exchange revealed plans to launch an electronic exchange in Dallas.
While many asset managers offer single-country funds, state-specific ETFs are rare. Two Texas-focused ETFs launched in 2023 have seen modest success, with the Texas Capital Texas Equity Index ETF and the Texas Capital Texas Small Cap Equity Index ETF gathering about $28 million and $12 million, respectively.
Analysts believe that if BlackRock’s Texas ETF performs well, it could attract more investors and further highlight Texas as a strong investment destination. The fees and ticker symbol for the new fund have not yet been disclosed.