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Should You Invest in the iShares U.S. Regional Banks ETF (IAT)?
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Launched on 05/01/2006, the iShares U.S. Regional Banks ETF (IAT - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Financials - Regional Banks segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Financials - Regional Banks is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 4, placing it in top 25%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $774.25 million, making it one of the average sized ETFs attempting to match the performance of the Financials - Regional Banks segment of the equity market. IAT seeks to match the performance of the Dow Jones U.S. Select Regional Banks Index before fees and expenses.
The Dow Jones U.S. Select Regional Banks Index is a free-float adjusted market capitalization-weighted index which measures the performance of the regional bank sub-sector of the U.S. equity market.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.39%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.81%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Financials sector--about 100% of the portfolio.
Looking at individual holdings, Pnc Financial Services Group Inc (PNC - Free Report) accounts for about 12.13% of total assets, followed by Truist Financial Corp (TFC - Free Report) and Us Bancorp (USB - Free Report) .
The top 10 holdings account for about 61.07% of total assets under management.
Performance and Risk
The ETF has lost about -18.43% and is down about -20.25% so far this year and in the past one year (as of 11/02/2022), respectively. IAT has traded between $46.85 and $69.28 during this last 52-week period.
The ETF has a beta of 1.13 and standard deviation of 40.96% for the trailing three-year period, making it a high risk choice in the space. With about 42 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Regional Banks ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IAT is a great option for investors seeking exposure to the Financials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Invesco KBW Regional Banking ETF (KBWR - Free Report) tracks KBW Nasdaq Regional Banking Index and the SPDR S&P Regional Banking ETF (KRE - Free Report) tracks S&P Regional Banks Select Industry Index. Invesco KBW Regional Banking ETF has $80.93 million in assets, SPDR S&P Regional Banking ETF has $3.65 billion. KBWR has an expense ratio of 0.35% and KRE charges 0.35%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should You Invest in the iShares U.S. Regional Banks ETF (IAT)?
Launched on 05/01/2006, the iShares U.S. Regional Banks ETF (IAT - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Financials - Regional Banks segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Financials - Regional Banks is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 4, placing it in top 25%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $774.25 million, making it one of the average sized ETFs attempting to match the performance of the Financials - Regional Banks segment of the equity market. IAT seeks to match the performance of the Dow Jones U.S. Select Regional Banks Index before fees and expenses.
The Dow Jones U.S. Select Regional Banks Index is a free-float adjusted market capitalization-weighted index which measures the performance of the regional bank sub-sector of the U.S. equity market.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.39%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.81%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Financials sector--about 100% of the portfolio.
Looking at individual holdings, Pnc Financial Services Group Inc (PNC - Free Report) accounts for about 12.13% of total assets, followed by Truist Financial Corp (TFC - Free Report) and Us Bancorp (USB - Free Report) .
The top 10 holdings account for about 61.07% of total assets under management.
Performance and Risk
The ETF has lost about -18.43% and is down about -20.25% so far this year and in the past one year (as of 11/02/2022), respectively. IAT has traded between $46.85 and $69.28 during this last 52-week period.
The ETF has a beta of 1.13 and standard deviation of 40.96% for the trailing three-year period, making it a high risk choice in the space. With about 42 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Regional Banks ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IAT is a great option for investors seeking exposure to the Financials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Invesco KBW Regional Banking ETF (KBWR - Free Report) tracks KBW Nasdaq Regional Banking Index and the SPDR S&P Regional Banking ETF (KRE - Free Report) tracks S&P Regional Banks Select Industry Index. Invesco KBW Regional Banking ETF has $80.93 million in assets, SPDR S&P Regional Banking ETF has $3.65 billion. KBWR has an expense ratio of 0.35% and KRE charges 0.35%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.