Designed to provide broad exposure to the World ETFs category of the market, the iShares MSCI ACWI Low Carbon Target ETF (
CRBN Quick Quote CRBN - Free Report) is a smart beta exchange traded fund launched on 12/08/2014. What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is sponsored by Blackrock. It has amassed assets over $684.39 million, making it one of the larger ETFs in the World ETFs. Before fees and expenses, this particular fund seeks to match the performance of the MSCI ACWI Low Carbon Target Index.
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
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
With one of the least expensive products in the space, this ETF has annual operating expenses of 0.20%.
It's 12-month trailing dividend yield comes in at 1.34%.
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.
When you look at individual holdings, Apple Inc (
AAPL Quick Quote AAPL - Free Report) accounts for about 3.66% of the fund's total assets, followed by Microsoft Corp ( MSFT Quick Quote MSFT - Free Report) and Amazon Com Inc ( AMZN Quick Quote AMZN - Free Report) .
Its top 10 holdings account for approximately 14.47% of CRBN's total assets under management.
Performance and Risk
The ETF has added roughly 6.13% so far this year and is up about 20.15% in the last one year (as of 02/12/2021). In the past 52-week period, it has traded between $89.44 and $157.33.
The fund has a beta of 0.96 and standard deviation of 21.02% for the trailing three-year period, which makes CRBN a low risk choice in this particular space. With about 1413 holdings, it effectively diversifies company-specific risk.
IShares MSCI ACWI Low Carbon Target ETF is a reasonable option for investors seeking to outperform the World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI EM ETF (
ESGE Quick Quote ESGE - Free Report) tracks MSCI Emerging Markets ESG Focus Index and the iShares ESG Aware MSCI USA ETF ( ESGU Quick Quote ESGU - Free Report) tracks MSCI USA ESG Focus Index. IShares ESG Aware MSCI EM ETF has $7.45 billion in assets, iShares ESG Aware MSCI USA ETF has $14.14 billion. ESGE has an expense ratio of 0.25% and ESGU charges 0.15%.
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.
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.