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Should iShares Morningstar Large-Cap Value ETF (JKF) Be on Your Investing Radar?
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If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the iShares Morningstar Large-Cap Value ETF , a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $401.50 M, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies usually have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.25%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.51%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Jpmorgan Chase & Co (JPM - Free Report) accounts for about 5.91% of total assets, followed by Berkshire Hathaway Inc Class B (BRKB) and Exxon Mobil Corp (XOM - Free Report) .
The top 10 holdings account for about 40.19% of total assets under management.
Performance and Risk
JKF seeks to match the performance of the Morningstar Large Value Index before fees and expenses. The Morningstar Large Value Index measures the performance of stocks issued by large-capitalization comp that have exhibited value characteristics.
The ETF has added about 1.35% so far this year and was up about 12.32% in the last one year (as of 08/13/2018). In the past 52-week period, it has traded between $95.53 and $112.57.
The ETF has a beta of 0.94 and standard deviation of 13.06% for the trailing three-year period, making it a medium risk choice in the space. With about 77 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Large-Cap Value 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, JKF is a reasonable option for those seeking exposure to the Large Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $37.71 B in assets, Vanguard Value ETF has $42.14 B. IWD has an expense ratio of 0.20% and VTV charges 0.05%.
Bottom-Line
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.
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 Large-Cap Value ETF (JKF) Be on Your Investing Radar?
If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the iShares Morningstar Large-Cap Value ETF , a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $401.50 M, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies usually have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.25%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.51%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Jpmorgan Chase & Co (JPM - Free Report) accounts for about 5.91% of total assets, followed by Berkshire Hathaway Inc Class B (BRKB) and Exxon Mobil Corp (XOM - Free Report) .
The top 10 holdings account for about 40.19% of total assets under management.
Performance and Risk
JKF seeks to match the performance of the Morningstar Large Value Index before fees and expenses. The Morningstar Large Value Index measures the performance of stocks issued by large-capitalization comp that have exhibited value characteristics.
The ETF has added about 1.35% so far this year and was up about 12.32% in the last one year (as of 08/13/2018). In the past 52-week period, it has traded between $95.53 and $112.57.
The ETF has a beta of 0.94 and standard deviation of 13.06% for the trailing three-year period, making it a medium risk choice in the space. With about 77 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Large-Cap Value 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, JKF is a reasonable option for those seeking exposure to the Large Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $37.71 B in assets, Vanguard Value ETF has $42.14 B. IWD has an expense ratio of 0.20% and VTV charges 0.05%.
Bottom-Line
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.
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.