Designed to provide broad exposure to the Large Cap Blend segment of the US equity market, the iShares Russell Top 200 ETF (IWL) is a passively managed exchange traded fund launched on 09/22/2009.
The fund is sponsored by Blackrock. It has amassed assets over $867.06 million, making it one of the larger ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
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.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
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 0.15%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.27%.
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 Information Technology sector--about 30.80% of the portfolio. Healthcare and Consumer Discretionary round out the top three.
Looking at individual holdings, Apple Inc (AAPL) accounts for about 7.86% of total assets, followed by Microsoft Corp (MSFT) and Amazon Com Inc (AMZN).
The top 10 holdings account for about 32.41% of total assets under management.
Performance and Risk
IWL seeks to match the performance of the Russell Top 200 Index before fees and expenses. The Russell Top 200 Index is a float-adjusted, capitalization-weighted index that measures the performance of the largest capitalization sector of the U.S. equity market.
The ETF has added about 3.48% so far this year and it's up approximately 23.75% in the last one year (as of 02/03/2021). In the past 52-week period, it has traded between $53.58 and $92.78.
The ETF has a beta of 0.99 and standard deviation of 23.25% for the trailing three-year period, making it a medium risk choice in the space. With about 198 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Russell Top 200 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, IWL is a good option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV) and the SPDR S&P 500 ETF (SPY) track a similar index. While iShares Core S&P 500 ETF has $241.02 billion in assets, SPDR S&P 500 ETF has $325.75 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
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 Russell Top 200 ETF (IWL) Be on Your Investing Radar?
Designed to provide broad exposure to the Large Cap Blend segment of the US equity market, the iShares Russell Top 200 ETF (IWL) is a passively managed exchange traded fund launched on 09/22/2009.
The fund is sponsored by Blackrock. It has amassed assets over $867.06 million, making it one of the larger ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
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.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
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 0.15%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.27%.
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 Information Technology sector--about 30.80% of the portfolio. Healthcare and Consumer Discretionary round out the top three.
Looking at individual holdings, Apple Inc (AAPL) accounts for about 7.86% of total assets, followed by Microsoft Corp (MSFT) and Amazon Com Inc (AMZN).
The top 10 holdings account for about 32.41% of total assets under management.
Performance and Risk
IWL seeks to match the performance of the Russell Top 200 Index before fees and expenses. The Russell Top 200 Index is a float-adjusted, capitalization-weighted index that measures the performance of the largest capitalization sector of the U.S. equity market.
The ETF has added about 3.48% so far this year and it's up approximately 23.75% in the last one year (as of 02/03/2021). In the past 52-week period, it has traded between $53.58 and $92.78.
The ETF has a beta of 0.99 and standard deviation of 23.25% for the trailing three-year period, making it a medium risk choice in the space. With about 198 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Russell Top 200 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, IWL is a good option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV) and the SPDR S&P 500 ETF (SPY) track a similar index. While iShares Core S&P 500 ETF has $241.02 billion in assets, SPDR S&P 500 ETF has $325.75 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
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.