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Should iShares Morningstar Mid-Cap Growth ETF (JKH) Be on Your Investing Radar?
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Launched on 06/28/2004, the iShares Morningstar Mid-Cap Growth ETF is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Growth segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $600.54 M, 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
With market capitalization between $2 billion and $10 billion, mid cap companies usually contain higher growth prospects than large cap companies, and are considered less risky than their small cap counterparts. Thus they have a nice balance of growth potential and stability.
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. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. Even though growth stocks are more likely to outperform their value counterparts in strong bull markets, value stocks have a record of delivering better returns in almost all markets than growth stocks.
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 0.30%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.30%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 30.80% of the portfolio. Healthcare and Industrials round out the top three.
Looking at individual holdings, Global Payments Inc (GPN - Free Report) accounts for about 2.29% of total assets, followed by Sba Communications Reit Corp Class (SBAC - Free Report) and Hilton Worldwide Holdings Inc (HLT - Free Report) .
The top 10 holdings account for about 13.42% of total assets under management.
Performance and Risk
JKH seeks to match the performance of the Morningstar Mid Growth Index before fees and expenses. The Morningstar Mid Growth Index measures the performance of stocks issued by mid-capitalization companies. The Morningstar index methodology defines mid-capitalization stocks as those stocks that form the 20% of market capitalization between the 70th and 90th percentile of the market capitalization of the stocks eligible to be included in the Morningstar US Market Index.
The ETF return is roughly 25.89% so far this year and was up about 4.15% in the last one year (as of 09/25/2019). In the past 52-week period, it has traded between $180.97 and $259.55.
The ETF has a beta of 1.08 and standard deviation of 14.65% for the trailing three-year period, making it a medium risk choice in the space. With about 193 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Mid-Cap Growth 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, JKH 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 iShares S&P Mid-Cap 400 Growth ETF (IJK - Free Report) and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) track a similar index. While iShares S&P Mid-Cap 400 Growth ETF has $7.29 B in assets, iShares Russell Mid-Cap Growth ETF has $10.78 B. IJK has an expense ratio of 0.24% and IWP charges 0.24%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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 (JKH) Be on Your Investing Radar?
Launched on 06/28/2004, the iShares Morningstar Mid-Cap Growth ETF is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Growth segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $600.54 M, 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
With market capitalization between $2 billion and $10 billion, mid cap companies usually contain higher growth prospects than large cap companies, and are considered less risky than their small cap counterparts. Thus they have a nice balance of growth potential and stability.
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. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. Even though growth stocks are more likely to outperform their value counterparts in strong bull markets, value stocks have a record of delivering better returns in almost all markets than growth stocks.
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 0.30%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.30%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 30.80% of the portfolio. Healthcare and Industrials round out the top three.
Looking at individual holdings, Global Payments Inc (GPN - Free Report) accounts for about 2.29% of total assets, followed by Sba Communications Reit Corp Class (SBAC - Free Report) and Hilton Worldwide Holdings Inc (HLT - Free Report) .
The top 10 holdings account for about 13.42% of total assets under management.
Performance and Risk
JKH seeks to match the performance of the Morningstar Mid Growth Index before fees and expenses. The Morningstar Mid Growth Index measures the performance of stocks issued by mid-capitalization companies. The Morningstar index methodology defines mid-capitalization stocks as those stocks that form the 20% of market capitalization between the 70th and 90th percentile of the market capitalization of the stocks eligible to be included in the Morningstar US Market Index.
The ETF return is roughly 25.89% so far this year and was up about 4.15% in the last one year (as of 09/25/2019). In the past 52-week period, it has traded between $180.97 and $259.55.
The ETF has a beta of 1.08 and standard deviation of 14.65% for the trailing three-year period, making it a medium risk choice in the space. With about 193 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Mid-Cap Growth 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, JKH 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 iShares S&P Mid-Cap 400 Growth ETF (IJK - Free Report) and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) track a similar index. While iShares S&P Mid-Cap 400 Growth ETF has $7.29 B in assets, iShares Russell Mid-Cap Growth ETF has $10.78 B. IJK has an expense ratio of 0.24% and IWP charges 0.24%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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.