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Is iShares Core S&P U.S. Value ETF (IUSV) a Strong ETF Right Now?
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The iShares Core S&P U.S. Value ETF (IUSV - Free Report) made its debut on 07/24/2000, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - All Cap Value category of the market.
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.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
IUSV is managed by Blackrock, and this fund has amassed over $11.29 billion, which makes it the largest ETF in the Style Box - All Cap Value. This particular fund seeks to match the performance of the S&P 900 Value Index before fees and expenses.
The S&P 900 Value Index measures the performance of the large and mid-capitalization value sector of the U.S. equity market.
Cost & Other Expenses
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 cousins, other things remaining the same.
Operating expenses on an annual basis are 0.04% for IUSV, making it the least expensive product in the space.
The fund has a 12-month trailing dividend yield of 2.22%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector - about 16.60% of the portfolio. Financials and Industrials round out the top three.
Looking at individual holdings, Berkshire Hathaway Inc Class B (BRK.B - Free Report) accounts for about 2.94% of total assets, followed by Johnson & Johnson (JNJ - Free Report) and Procter & Gamble (PG - Free Report) .
The top 10 holdings account for about 16.44% of total assets under management.
Performance and Risk
Year-to-date, the iShares Core S&P U.S. Value ETF has lost about -11.59% so far, and is down about -4.51% over the last 12 months (as of 07/07/2022). IUSV has traded between $64.88 and $77.49 in this past 52-week period.
IUSV has a beta of 0.96 and standard deviation of 23.73% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 752 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Core S&P U.S. Value ETF is an excellent option for investors seeking to outperform the Style Box - All Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
Invesco High Yield Equity Dividend Achievers ETF (PEY - Free Report) tracks NASDAQ US Dividend Achievers 50 Index and the Dimensional U.S. Targeted Value ETF (DFAT - Free Report) tracks ----------------------------------------. Invesco High Yield Equity Dividend Achievers ETF has $1.23 billion in assets, Dimensional U.S. Targeted Value ETF has $6.17 billion. PEY has an expense ratio of 0.53% and DFAT charges 0.29%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - All Cap Value.
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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Is iShares Core S&P U.S. Value ETF (IUSV) a Strong ETF Right Now?
The iShares Core S&P U.S. Value ETF (IUSV - Free Report) made its debut on 07/24/2000, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - All Cap Value category of the market.
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.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
IUSV is managed by Blackrock, and this fund has amassed over $11.29 billion, which makes it the largest ETF in the Style Box - All Cap Value. This particular fund seeks to match the performance of the S&P 900 Value Index before fees and expenses.
The S&P 900 Value Index measures the performance of the large and mid-capitalization value sector of the U.S. equity market.
Cost & Other Expenses
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 cousins, other things remaining the same.
Operating expenses on an annual basis are 0.04% for IUSV, making it the least expensive product in the space.
The fund has a 12-month trailing dividend yield of 2.22%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector - about 16.60% of the portfolio. Financials and Industrials round out the top three.
Looking at individual holdings, Berkshire Hathaway Inc Class B (BRK.B - Free Report) accounts for about 2.94% of total assets, followed by Johnson & Johnson (JNJ - Free Report) and Procter & Gamble (PG - Free Report) .
The top 10 holdings account for about 16.44% of total assets under management.
Performance and Risk
Year-to-date, the iShares Core S&P U.S. Value ETF has lost about -11.59% so far, and is down about -4.51% over the last 12 months (as of 07/07/2022). IUSV has traded between $64.88 and $77.49 in this past 52-week period.
IUSV has a beta of 0.96 and standard deviation of 23.73% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 752 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Core S&P U.S. Value ETF is an excellent option for investors seeking to outperform the Style Box - All Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
Invesco High Yield Equity Dividend Achievers ETF (PEY - Free Report) tracks NASDAQ US Dividend Achievers 50 Index and the Dimensional U.S. Targeted Value ETF (DFAT - Free Report) tracks ----------------------------------------. Invesco High Yield Equity Dividend Achievers ETF has $1.23 billion in assets, Dimensional U.S. Targeted Value ETF has $6.17 billion. PEY has an expense ratio of 0.53% and DFAT charges 0.29%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - All Cap Value.
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.