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Is iShares MSCI ACWI Low Carbon Target ETF (CRBN) a Strong ETF Right Now?
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Designed to provide broad exposure to the World ETFs category of the market, the iShares MSCI ACWI Low Carbon Target ETF (CRBN - Free Report) is a smart beta exchange traded fund launched on 12/08/2014.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is managed by Blackrock, and has been able to amass over $448.62 M, which makes it one of the larger ETFs in the World ETFs. This particular fund seeks to match the performance of the MSCI ACWI Low Carbon Target Index before fees and expenses.
The MSCI ACWI Low Carbon Target Index is designed to address two dimensions of carbon exposure ? carbon emissions and potential carbon emissions from fossil fuel reserves.
Cost & Other Expenses
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 CRBN are 0.20%, which makes it one of the least expensive products in the space.
CRBN's 12-month trailing dividend yield is 2.19%.
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.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 2.38% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon Com Inc (AMZN - Free Report) .
The top 10 holdings account for about 11.59% of total assets under management.
Performance and Risk
Year-to-date, the iShares MSCI ACWI Low Carbon Target ETF has added roughly 20.67% so far, and is up about 13.69% over the last 12 months (as of 10/28/2019). CRBN has traded between $99 and $122.91 in this past 52-week period.
CRBN has a beta of 0.97 and standard deviation of 11.81% for the trailing three-year period, which makes the fund a low risk choice in the space. With about 1300 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI ACWI Low Carbon Target ETF is an excellent option for investors seeking to outperform the World ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
IShares MSCI KLD 400 Social ETF (DSI - Free Report) tracks MSCI KLD 400 Social Index and the iShares ESG MSCI USA Leaders ETF (SUSL - Free Report) tracks MSCI USA EXTENDED ESG LEADERS INDEX. IShares MSCI KLD 400 Social ETF has $1.60 B in assets, iShares ESG MSCI USA Leaders ETF has $1.61 B. DSI has an expense ratio of 0.25% and SUSL charges 0.10%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the World ETFs.
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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Is iShares MSCI ACWI Low Carbon Target ETF (CRBN) a Strong ETF Right Now?
Designed to provide broad exposure to the World ETFs category of the market, the iShares MSCI ACWI Low Carbon Target ETF (CRBN - Free Report) is a smart beta exchange traded fund launched on 12/08/2014.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is managed by Blackrock, and has been able to amass over $448.62 M, which makes it one of the larger ETFs in the World ETFs. This particular fund seeks to match the performance of the MSCI ACWI Low Carbon Target Index before fees and expenses.
The MSCI ACWI Low Carbon Target Index is designed to address two dimensions of carbon exposure ? carbon emissions and potential carbon emissions from fossil fuel reserves.
Cost & Other Expenses
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 CRBN are 0.20%, which makes it one of the least expensive products in the space.
CRBN's 12-month trailing dividend yield is 2.19%.
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.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 2.38% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon Com Inc (AMZN - Free Report) .
The top 10 holdings account for about 11.59% of total assets under management.
Performance and Risk
Year-to-date, the iShares MSCI ACWI Low Carbon Target ETF has added roughly 20.67% so far, and is up about 13.69% over the last 12 months (as of 10/28/2019). CRBN has traded between $99 and $122.91 in this past 52-week period.
CRBN has a beta of 0.97 and standard deviation of 11.81% for the trailing three-year period, which makes the fund a low risk choice in the space. With about 1300 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI ACWI Low Carbon Target ETF is an excellent option for investors seeking to outperform the World ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
IShares MSCI KLD 400 Social ETF (DSI - Free Report) tracks MSCI KLD 400 Social Index and the iShares ESG MSCI USA Leaders ETF (SUSL - Free Report) tracks MSCI USA EXTENDED ESG LEADERS INDEX. IShares MSCI KLD 400 Social ETF has $1.60 B in assets, iShares ESG MSCI USA Leaders ETF has $1.61 B. DSI has an expense ratio of 0.25% and SUSL charges 0.10%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the World ETFs.
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.