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Nov. 23, 2020, 8:30 p.m. EST

BlackRock to buy customized-index provider Aperio for $1 billion

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By Kimberly Chin and Dawn Lim

BlackRock Inc. is acquiring Aperio Group LLC, a firm that helps build custom portfolios for wealthy individuals, for $1.05 billion, in a push by the world’s largest money manager to add more personalization to its offerings.

In buying Aperio, BlackRock /zigman2/quotes/207946232/composite BLK +0.27% is betting on growing interest by individuals for portfolios tailored to their values. Aperio is part of the so-called direct indexing industry, a small-but-expanding part of the financial space.

Such firms create indexes and portfolios that can be customized to exclude certain stocks or have more exposure to other sectors. Sausalito, Calif.-based Aperio has worked with financial advisers to tailor bespoke client portfolios. For instance, it could build a portfolio without tobacco exposure that has more renewable energy holdings.

These portfolios are created for single investors rather than forcing investors to be stuck with others in a fund. A provider of such separately managed accounts for U.S. wealth managers, BlackRock said the combination will help increase those assets by about 30% to over $160 billion.

An expanded version of this report appears on WSJ.com.

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Jan. 20, 2021 2:20p
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