Designed to provide broad exposure to the Consumer Discretionary - Broad segment of the equity market, the iShares U.S. Consumer Discretionary ETF (
IYC Quick Quote IYC - Free Report) is a passively managed exchange traded fund launched on 06/12/2000.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds 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. Consumer Discretionary - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 13, placing it in bottom 19%.
The fund is sponsored by Blackrock. It has amassed assets over $1.45 billion, making it one of the larger ETFs attempting to match the performance of the Consumer Discretionary - Broad segment of the equity market. IYC seeks to match the performance of the Dow Jones U.S. Consumer Services Index before fees and expenses.
The Dow Jones U.S. Consumer Services Index measures the performance of the consumer services sector of the U.S. equity market.
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.41%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.49%.
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.
This ETF has heaviest allocation in the Consumer Discretionary sector--about 57.90% of the portfolio. Telecom and Consumer Staples round out the top three.
Looking at individual holdings, Amazon Com Inc (
AMZN Quick Quote AMZN - Free Report) accounts for about 10.32% of total assets, followed by Home Depot Inc ( HD Quick Quote HD - Free Report) and Walt Disney ( DIS Quick Quote DIS - Free Report) .
The top 10 holdings account for about 50.65% of total assets under management.
Performance and Risk
So far this year, IYC has gained about 24.96%, and is up about 33.34% in the last one year (as of 11/09/2021). During this past 52-week period, the fund has traded between $65.37 and $86.98.
The ETF has a beta of 1.09 and standard deviation of 22.34% for the trailing three-year period, making it a medium risk choice in the space. With about 139 holdings, it effectively diversifies company-specific risk.
IShares U.S. Consumer Discretionary 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, IYC is a good option for those seeking exposure to the Consumer Discretionary ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Consumer Discretionary ETF (
VCR Quick Quote VCR - Free Report) tracks MSCI US Investable Market Consumer Discretionary 25/50 Index and the Consumer Discretionary Select Sector SPDR ETF ( XLY Quick Quote XLY - Free Report) tracks Consumer Discretionary Select Sector Index. Vanguard Consumer Discretionary ETF has $7.35 billion in assets, Consumer Discretionary Select Sector SPDR ETF has $23.49 billion. VCR has an expense ratio of 0.10% and XLY 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.