Launched on 07/24/2000, the iShares Russell 2000 Value ETF (
IWN Quick Quote IWN - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $14.96 billion, making it one of the largest ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
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 0.24%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.52%.
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 to the Financials sector--about 26.40% of the portfolio. Industrials and Real Estate round out the top three.
Looking at individual holdings, Amc Entertainment Holdings Inc Cla (
AMC Quick Quote AMC - Free Report) accounts for about 1.25% of total assets, followed by Ovintiv Inc ( OVV Quick Quote OVV - Free Report) and Macys Inc ( M Quick Quote M - Free Report) . Performance and Risk
IWN seeks to match the performance of the Russell 2000 Value Index before fees and expenses. The Russell 2000 Value Index measures the performance of the small-capitalization value sector of the U.S. equity market.
The ETF has lost about -3.67% so far this year and is down about -0.07% in the last one year (as of 03/22/2022). In the past 52-week period, it has traded between $151.25 and $176.88.
The ETF has a beta of 1.17 and standard deviation of 30.99% for the trailing three-year period, making it a medium risk choice in the space. With about 1428 holdings, it effectively diversifies company-specific risk.
IShares Russell 2000 Value 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, IWN is an outstanding option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares S&P SmallCap 600 Value ETF (
IJS Quick Quote IJS - Free Report) and the Vanguard SmallCap Value ETF ( VBR Quick Quote VBR - Free Report) track a similar index. While iShares S&P SmallCap 600 Value ETF has $8.99 billion in assets, Vanguard SmallCap Value ETF has $27.24 billion. IJS has an expense ratio of 0.18% and VBR charges 0.07%. Bottom-Line
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.
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.