BlackRock rips hedge-fund playbook into ETFs with liquid alts

BlackRock has moved hedge-fund-like strategies into the exchange-traded fund format, expanding its lineup of liquid-alternative ETFs that package long-short and trend-following approaches inside daily-traded wrappers. The shift aims to make previously semi-opaque, less-liquid strategies available to a wider investor base via ETF structures.

Concrete examples include the iShares Managed Futures Active ETF (ISMF), launched in March 2025, and the iShares Systematic Alternatives Active ETF (IALT), introduced in December 2025. ISMF’s disclosure materials describe a disciplined long/short approach to capture trend signals across futures and derivatives and name Jeffrey Rosenberg among the lead managers; IALT combines equity market-neutral, diversified bond sleeves and managed-futures exposures to pursue low-correlation returns.

BlackRock’s communications emphasize the growth and scale of the managed-futures and liquid-alternative categories, noting that managed futures represent a multi-billion-dollar segment and that Managed Futures ETF assets have more than tripled since 2021. The firm positions the new ETFs as potential diversifiers and hedges within multi-asset portfolios, while also flagging the volatility and liquidity characteristics inherent to futures and derivative exposures.

Strategically, this reflects a broader industry trend: institutional hedge-fund techniques are being repackaged with the transparency and accessibility of ETFs. BlackRock Systematic’s use of quantitative models, big data and technology to run these strategies at scale is central to the push, and the firm forecasts meaningful growth in active ETF assets over the coming years—a dynamic that could reshape how advisors construct portfolios.

Market observers say the ETFization of hedge-fund style strategies could attract allocators seeking non-correlated return streams, but they caution that risk management, fee design and regulatory disclosure will be critical. If demand continues, similar offerings from other large asset managers are likely, increasing competition in the liquid-alts ETF space and testing whether ETF wrappers can deliver hedge-fund-like outcomes at scale.