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Should Vanguard S&P MidCap 400 Value ETF (IVOV) Be on Your Investing Radar?
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If you're interested in broad exposure to the Mid Cap Value segment of the US equity market, look no further than the Vanguard S&P MidCap 400 Value ETF (IVOV - Free Report) , a passively managed exchange traded fund launched on 09/09/2010.
The fund is sponsored by Vanguard. It has amassed assets over $842.54 million, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus, companies that fall under this category provide a stable and growth-heavy investment.
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.
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 1.80%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. 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 20.80% of the portfolio. Industrials and Real Estate round out the top three.
Looking at individual holdings, Jones Lang Lasalle Inc. (JLL - Free Report) accounts for about 1.01% of total assets, followed by Steel Dynamics Inc. (STLD - Free Report) and East West Bancorp Inc. (EWBC - Free Report) .
The top 10 holdings account for about 7.33% of total assets under management.
Performance and Risk
IVOV seeks to match the performance of the S&P MidCap 400 Value Index before fees and expenses. The S&P MidCap 400 Value Index measures the performance of value stocks of medium-size U.S. companies.
The ETF has lost about -1.67% so far this year and it's up approximately 8.23% in the last one year (as of 03/22/2022). In the past 52-week period, it has traded between $150.50 and $174.89.
The ETF has a beta of 1.22 and standard deviation of 29.42% for the trailing three-year period, making it a medium risk choice in the space. With about 310 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard S&P MidCap 400 Value ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IVOV is an outstanding option for investors seeking exposure to the Style Box - Mid Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell MidCap Value ETF (IWS - Free Report) and the Vanguard MidCap Value ETF (VOE - Free Report) track a similar index. While iShares Russell MidCap Value ETF has $14.95 billion in assets, Vanguard MidCap Value ETF has $16.69 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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.
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Should Vanguard S&P MidCap 400 Value ETF (IVOV) Be on Your Investing Radar?
If you're interested in broad exposure to the Mid Cap Value segment of the US equity market, look no further than the Vanguard S&P MidCap 400 Value ETF (IVOV - Free Report) , a passively managed exchange traded fund launched on 09/09/2010.
The fund is sponsored by Vanguard. It has amassed assets over $842.54 million, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus, companies that fall under this category provide a stable and growth-heavy investment.
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.
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 1.80%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. 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 20.80% of the portfolio. Industrials and Real Estate round out the top three.
Looking at individual holdings, Jones Lang Lasalle Inc. (JLL - Free Report) accounts for about 1.01% of total assets, followed by Steel Dynamics Inc. (STLD - Free Report) and East West Bancorp Inc. (EWBC - Free Report) .
The top 10 holdings account for about 7.33% of total assets under management.
Performance and Risk
IVOV seeks to match the performance of the S&P MidCap 400 Value Index before fees and expenses. The S&P MidCap 400 Value Index measures the performance of value stocks of medium-size U.S. companies.
The ETF has lost about -1.67% so far this year and it's up approximately 8.23% in the last one year (as of 03/22/2022). In the past 52-week period, it has traded between $150.50 and $174.89.
The ETF has a beta of 1.22 and standard deviation of 29.42% for the trailing three-year period, making it a medium risk choice in the space. With about 310 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard S&P MidCap 400 Value ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IVOV is an outstanding option for investors seeking exposure to the Style Box - Mid Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell MidCap Value ETF (IWS - Free Report) and the Vanguard MidCap Value ETF (VOE - Free Report) track a similar index. While iShares Russell MidCap Value ETF has $14.95 billion in assets, Vanguard MidCap Value ETF has $16.69 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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.