Launched on 05/22/2000, the iShares Russell 1000 Growth ETF (
IWF Quick Quote IWF - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $59.08 billion, making it one of the largest ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Qualities of growth stocks include faster growth rates compared to the broader market, as well as higher valuations and higher than average sales and earnings growth rates. Additionally, growth stocks have a greater level of risk associated with them. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all markets.
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 0.19%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.74%.
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 Information Technology sector--about 49.40% of the portfolio. Consumer Discretionary and Healthcare round out the top three.
Looking at individual holdings, Apple Inc (
AAPL Quick Quote AAPL - Free Report) accounts for about 12.50% of total assets, followed by Microsoft Corp ( MSFT Quick Quote MSFT - Free Report) and Amazon Com Inc ( AMZN Quick Quote AMZN - Free Report) .
The top 10 holdings account for about 47.73% of total assets under management.
Performance and Risk
IWF seeks to match the performance of the Russell 1000 Growth Index before fees and expenses. The Russell 1000 Growth Index measures the performance of the large-capitalization growth sector of the U.S. equity market.
The ETF has lost about -26.91% so far this year and is down about -17.89% in the last one year (as of 07/19/2022). In the past 52-week period, it has traded between $209.90 and $309.52.
The ETF has a beta of 1.07 and standard deviation of 26.98% for the trailing three-year period, making it a medium risk choice in the space. With about 505 holdings, it effectively diversifies company-specific risk.
IShares Russell 1000 Growth 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, IWF is an excellent option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (
VUG Quick Quote VUG - Free Report) and the Invesco QQQ ( QQQ Quick Quote QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $68.36 billion in assets, Invesco QQQ has $160.72 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%. Bottom-Line
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.
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.