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Should iShares Morningstar Mid-Cap Growth ETF (IMCG) Be on Your Investing Radar?
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Designed to provide broad exposure to the Mid Cap Growth segment of the US equity market, the iShares Morningstar Mid-Cap Growth ETF (IMCG - 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 $1.87 billion, making it one of the average sized ETFs attempting to match the Mid Cap Growth segment of the US equity market.
Why Mid Cap Growth
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus, companies that fall under this category provide a stable and growth-heavy investment.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.06%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.87%.
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 to the Industrials sector--about 23.10% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Workday Inc Class A (WDAY - Free Report) accounts for about 1.28% of total assets, followed by Crowdstrike Holdings Inc Class A (CRWD - Free Report) and Transdigm Group Inc (TDG - Free Report) .
The top 10 holdings account for about 10.77% of total assets under management.
Performance and Risk
IMCG seeks to match the performance of the MORNINGSTAR US MID CAP BROAD GROWTH INDX before fees and expenses. The Morningstar US Mid Cap Broad Growth Index comprises of mid-capitalization U.S. equities that exhibit growth characteristics.
The ETF has lost about -2.85% so far this year and it's up approximately 10.82% in the last one year (as of 01/18/2024). In the past 52-week period, it has traded between $53.24 and $64.90.
The ETF has a beta of 1.09 and standard deviation of 22.06% for the trailing three-year period. With about 315 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Mid-Cap Growth ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IMCG is a great option for investors seeking exposure to the Style Box - Mid Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Mid-Cap Growth ETF (VOT - Free Report) and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) track a similar index. While Vanguard Mid-Cap Growth ETF has $11.49 billion in assets, iShares Russell Mid-Cap Growth ETF has $14.02 billion. VOT has an expense ratio of 0.07% and IWP charges 0.23%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds 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 Mid-Cap Growth ETF (IMCG) Be on Your Investing Radar?
Designed to provide broad exposure to the Mid Cap Growth segment of the US equity market, the iShares Morningstar Mid-Cap Growth ETF (IMCG - 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 $1.87 billion, making it one of the average sized ETFs attempting to match the Mid Cap Growth segment of the US equity market.
Why Mid Cap Growth
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus, companies that fall under this category provide a stable and growth-heavy investment.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.06%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.87%.
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 to the Industrials sector--about 23.10% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Workday Inc Class A (WDAY - Free Report) accounts for about 1.28% of total assets, followed by Crowdstrike Holdings Inc Class A (CRWD - Free Report) and Transdigm Group Inc (TDG - Free Report) .
The top 10 holdings account for about 10.77% of total assets under management.
Performance and Risk
IMCG seeks to match the performance of the MORNINGSTAR US MID CAP BROAD GROWTH INDX before fees and expenses. The Morningstar US Mid Cap Broad Growth Index comprises of mid-capitalization U.S. equities that exhibit growth characteristics.
The ETF has lost about -2.85% so far this year and it's up approximately 10.82% in the last one year (as of 01/18/2024). In the past 52-week period, it has traded between $53.24 and $64.90.
The ETF has a beta of 1.09 and standard deviation of 22.06% for the trailing three-year period. With about 315 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Mid-Cap Growth ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IMCG is a great option for investors seeking exposure to the Style Box - Mid Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Mid-Cap Growth ETF (VOT - Free Report) and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) track a similar index. While Vanguard Mid-Cap Growth ETF has $11.49 billion in assets, iShares Russell Mid-Cap Growth ETF has $14.02 billion. VOT has an expense ratio of 0.07% and IWP charges 0.23%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds 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.