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Is iShares U.S. Infrastructure ETF (IFRA) a Strong ETF Right Now?
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Launched on 04/03/2018, the iShares U.S. Infrastructure ETF (IFRA - Free Report) is a smart beta exchange traded fund offering broad exposure to the Utilities/Infrastructure ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
IFRA is managed by Blackrock, and this fund has amassed over $1.62 billion, which makes it one of the average sized ETFs in the Utilities/Infrastructure ETFs. This particular fund seeks to match the performance of the NYSE FACTSET U.S. INFRASTRUCTURE INDEX before fees and expenses.
The NYSE FactSet U.S. Infrastructure Index comprises of equities of U.S. companies that have infrastructure exposure and that could benefit from a potential increase in domestic infrastructure activities.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.30%, making it one of the cheaper products in the space.
IFRA's 12-month trailing dividend yield is 1.97%.
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.
Representing 41.30% of the portfolio, the fund has heaviest allocation to the Utilities sector; Industrials and Materials round out the top three.
Taking into account individual holdings, Infrastructure And Energy Alternat accounts for about 1.01% of the fund's total assets, followed by Xpel Inc (XPEL - Free Report) and Otter Tail Corp (OTTR - Free Report) .
The top 10 holdings account for about 6.14% of total assets under management.
Performance and Risk
The ETF has lost about -7.28% so far this year and is down about -3.27% in the last one year (as of 11/04/2022). In the past 52-week period, it has traded between $32.24 and $39.92.
The ETF has a beta of 1.04 and standard deviation of 28.25% for the trailing three-year period. With about 163 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares U.S. Infrastructure ETF is an excellent option for investors seeking to outperform the Utilities/Infrastructure ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Global X U.S. Infrastructure Development ETF (PAVE - Free Report) tracks INDXX U.S. Infrastructure Development Index and the iShares Global Infrastructure ETF (IGF - Free Report) tracks S&P Global Infrastructure Index. Global X U.S. Infrastructure Development ETF has $3.43 billion in assets, iShares Global Infrastructure ETF has $3.44 billion. PAVE has an expense ratio of 0.47% and IGF charges 0.40%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Utilities/Infrastructure ETFs.
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 U.S. Infrastructure ETF (IFRA) a Strong ETF Right Now?
Launched on 04/03/2018, the iShares U.S. Infrastructure ETF (IFRA - Free Report) is a smart beta exchange traded fund offering broad exposure to the Utilities/Infrastructure ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
IFRA is managed by Blackrock, and this fund has amassed over $1.62 billion, which makes it one of the average sized ETFs in the Utilities/Infrastructure ETFs. This particular fund seeks to match the performance of the NYSE FACTSET U.S. INFRASTRUCTURE INDEX before fees and expenses.
The NYSE FactSet U.S. Infrastructure Index comprises of equities of U.S. companies that have infrastructure exposure and that could benefit from a potential increase in domestic infrastructure activities.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.30%, making it one of the cheaper products in the space.
IFRA's 12-month trailing dividend yield is 1.97%.
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.
Representing 41.30% of the portfolio, the fund has heaviest allocation to the Utilities sector; Industrials and Materials round out the top three.
Taking into account individual holdings, Infrastructure And Energy Alternat accounts for about 1.01% of the fund's total assets, followed by Xpel Inc (XPEL - Free Report) and Otter Tail Corp (OTTR - Free Report) .
The top 10 holdings account for about 6.14% of total assets under management.
Performance and Risk
The ETF has lost about -7.28% so far this year and is down about -3.27% in the last one year (as of 11/04/2022). In the past 52-week period, it has traded between $32.24 and $39.92.
The ETF has a beta of 1.04 and standard deviation of 28.25% for the trailing three-year period. With about 163 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares U.S. Infrastructure ETF is an excellent option for investors seeking to outperform the Utilities/Infrastructure ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Global X U.S. Infrastructure Development ETF (PAVE - Free Report) tracks INDXX U.S. Infrastructure Development Index and the iShares Global Infrastructure ETF (IGF - Free Report) tracks S&P Global Infrastructure Index. Global X U.S. Infrastructure Development ETF has $3.43 billion in assets, iShares Global Infrastructure ETF has $3.44 billion. PAVE has an expense ratio of 0.47% and IGF charges 0.40%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Utilities/Infrastructure ETFs.
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.