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Should iShares Morningstar Small-Cap ETF (ISCB) Be on Your Investing Radar?
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Designed to provide broad exposure to the Small Cap Blend segment of the US equity market, the iShares Morningstar Small-Cap ETF (ISCB - Free Report) is a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $205.63 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.04%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.65%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 17.80% of the portfolio. Healthcare and Financials round out the top three.
Looking at individual holdings, Lattice Semiconductor Corp (LSCC - Free Report) accounts for about 0.38% of total assets, followed by Exact Sciences Corp (EXAS - Free Report) and Penumbra Inc (PEN - Free Report) .
The top 10 holdings account for about 2.9% of total assets under management.
Performance and Risk
ISCB seeks to match the performance of the MORNINGSTAR US SMALL CAP EXTENDED INDEX before fees and expenses. The Morningstar US Small Cap Extended Index comprises of small-capitalization U.S. equities.
The ETF has gained about 5.27% so far this year and is down about -2.08% in the last one year (as of 06/05/2023). In the past 52-week period, it has traded between $42.56 and $52.48.
The ETF has a beta of 1.15 and standard deviation of 23.58% for the trailing three-year period. With about 1781 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Small-Cap ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, ISCB is a sufficient option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $51.22 billion in assets, iShares Core S&P Small-Cap ETF has $66.45 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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 iShares Morningstar Small-Cap ETF (ISCB) Be on Your Investing Radar?
Designed to provide broad exposure to the Small Cap Blend segment of the US equity market, the iShares Morningstar Small-Cap ETF (ISCB - Free Report) is a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $205.63 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.04%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.65%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 17.80% of the portfolio. Healthcare and Financials round out the top three.
Looking at individual holdings, Lattice Semiconductor Corp (LSCC - Free Report) accounts for about 0.38% of total assets, followed by Exact Sciences Corp (EXAS - Free Report) and Penumbra Inc (PEN - Free Report) .
The top 10 holdings account for about 2.9% of total assets under management.
Performance and Risk
ISCB seeks to match the performance of the MORNINGSTAR US SMALL CAP EXTENDED INDEX before fees and expenses. The Morningstar US Small Cap Extended Index comprises of small-capitalization U.S. equities.
The ETF has gained about 5.27% so far this year and is down about -2.08% in the last one year (as of 06/05/2023). In the past 52-week period, it has traded between $42.56 and $52.48.
The ETF has a beta of 1.15 and standard deviation of 23.58% for the trailing three-year period. With about 1781 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Small-Cap ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, ISCB is a sufficient option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $51.22 billion in assets, iShares Core S&P Small-Cap ETF has $66.45 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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.