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Should iShares Morningstar SmallCap Value ETF (ISCV) Be on Your Investing Radar?
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If you're interested in broad exposure to the Small Cap Value segment of the US equity market, look no further than the iShares Morningstar SmallCap Value ETF (ISCV - Free Report) , a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $413.26 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.06%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.06%.
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 26.70% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Nov Inc (NOV - Free Report) accounts for about 0.48% of total assets, followed by Unum (UNM - Free Report) and Hf Sinclair Corp (DINO - Free Report) .
The top 10 holdings account for about 4.12% of total assets under management.
Performance and Risk
ISCV seeks to match the performance of the MORNINGSTAR US SML CP BRD VLUE EXTD INDX before fees and expenses. The Morningstar US Small Cap Broad Value Extended Index comprises of small-capitalization U.S. equities that exhibit value characteristics.
The ETF has gained about 3.09% so far this year and is down about -9.06% in the last one year (as of 01/10/2023). In the past 52-week period, it has traded between $47.53 and $60.69.
The ETF has a beta of 1.23 and standard deviation of 32.98% for the trailing three-year period. With about 1215 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar SmallCap Value ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, ISCV is a sufficient option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard SmallCap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $12.19 billion in assets, Vanguard SmallCap Value ETF has $24.29 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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 iShares Morningstar SmallCap Value ETF (ISCV) Be on Your Investing Radar?
If you're interested in broad exposure to the Small Cap Value segment of the US equity market, look no further than the iShares Morningstar SmallCap Value ETF (ISCV - Free Report) , a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $413.26 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.06%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.06%.
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 26.70% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Nov Inc (NOV - Free Report) accounts for about 0.48% of total assets, followed by Unum (UNM - Free Report) and Hf Sinclair Corp (DINO - Free Report) .
The top 10 holdings account for about 4.12% of total assets under management.
Performance and Risk
ISCV seeks to match the performance of the MORNINGSTAR US SML CP BRD VLUE EXTD INDX before fees and expenses. The Morningstar US Small Cap Broad Value Extended Index comprises of small-capitalization U.S. equities that exhibit value characteristics.
The ETF has gained about 3.09% so far this year and is down about -9.06% in the last one year (as of 01/10/2023). In the past 52-week period, it has traded between $47.53 and $60.69.
The ETF has a beta of 1.23 and standard deviation of 32.98% for the trailing three-year period. With about 1215 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar SmallCap Value ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, ISCV is a sufficient option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard SmallCap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $12.19 billion in assets, Vanguard SmallCap Value ETF has $24.29 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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.