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Should You Invest in the iShares U.S. Industrials ETF (IYJ)?
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If you're interested in broad exposure to the Industrials - Broad segment of the equity market, look no further than the iShares U.S. Industrials ETF (IYJ - Free Report) , a passively managed exchange traded fund launched on 06/12/2000.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 15, placing it in bottom 6%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $1.69 billion, making it one of the larger ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. IYJ seeks to match the performance of the Dow Jones U.S. Industrials Index before fees and expenses.
The Dow Jones U.S. Industrials Index measures the performance of the industrial sector of the U.S. equity market. It includes: construction & materials, aerospace & defense, general industrials, electronic & electrical equipment, industrial engineering, industrial transportation & support services. The Index is capitalization-weighted.
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 0.41%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.81%.
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 in the Industrials sector--about 71.60% of the portfolio. Information Technology and Materials round out the top three.
Looking at individual holdings, Paypal Holdings Inc (PYPL - Free Report) accounts for about 6.77% of total assets, followed by Accenture Plc Class A (ACN - Free Report) and Honeywell International Inc (HON - Free Report) .
The top 10 holdings account for about 31.86% of total assets under management.
Performance and Risk
The ETF has added roughly 20.39% and was up about 30.84% so far this year and in the past one year (as of 10/26/2021), respectively. IYJ has traded between $81.66 and $114.98 during this last 52-week period.
The ETF has a beta of 1.18 and standard deviation of 25.75% 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 U.S. Industrials ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IYJ is an excellent option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Industrials ETF (VIS - Free Report) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI - Free Report) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $5.48 billion in assets, Industrial Select Sector SPDR ETF has $18.39 billion. VIS has an expense ratio of 0.10% and XLI charges 0.12%.
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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Should You Invest in the iShares U.S. Industrials ETF (IYJ)?
If you're interested in broad exposure to the Industrials - Broad segment of the equity market, look no further than the iShares U.S. Industrials ETF (IYJ - Free Report) , a passively managed exchange traded fund launched on 06/12/2000.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 15, placing it in bottom 6%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $1.69 billion, making it one of the larger ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. IYJ seeks to match the performance of the Dow Jones U.S. Industrials Index before fees and expenses.
The Dow Jones U.S. Industrials Index measures the performance of the industrial sector of the U.S. equity market. It includes: construction & materials, aerospace & defense, general industrials, electronic & electrical equipment, industrial engineering, industrial transportation & support services. The Index is capitalization-weighted.
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 0.41%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.81%.
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 in the Industrials sector--about 71.60% of the portfolio. Information Technology and Materials round out the top three.
Looking at individual holdings, Paypal Holdings Inc (PYPL - Free Report) accounts for about 6.77% of total assets, followed by Accenture Plc Class A (ACN - Free Report) and Honeywell International Inc (HON - Free Report) .
The top 10 holdings account for about 31.86% of total assets under management.
Performance and Risk
The ETF has added roughly 20.39% and was up about 30.84% so far this year and in the past one year (as of 10/26/2021), respectively. IYJ has traded between $81.66 and $114.98 during this last 52-week period.
The ETF has a beta of 1.18 and standard deviation of 25.75% 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 U.S. Industrials ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IYJ is an excellent option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Industrials ETF (VIS - Free Report) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI - Free Report) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $5.48 billion in assets, Industrial Select Sector SPDR ETF has $18.39 billion. VIS has an expense ratio of 0.10% and XLI charges 0.12%.
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.