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Should iShares S&P Small-Cap 600 Growth ETF (IJT) Be on Your Investing Radar?
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Looking for broad exposure to the Small Cap Growth segment of the US equity market? You should consider the iShares S&P Small-Cap 600 Growth ETF (IJT - Free Report) , a passively managed exchange traded fund launched on 07/24/2000.
The fund is sponsored by Blackrock. It has amassed assets over $4.77 billion, making it one of the larger ETFs attempting to match the Small Cap Growth segment of the US equity market.
Why Small Cap Growth
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Further, growth stocks have a higher level of volatility associated with them. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.18%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.17%.
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 Industrials sector--about 19.20% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Applied Industrial Technologies In (AIT - Free Report) accounts for about 1.18% of total assets, followed by Sps Commerce Inc (SPSC - Free Report) and Rambus Inc (RMBS - Free Report) .
The top 10 holdings account for about 10.42% of total assets under management.
Performance and Risk
IJT seeks to match the performance of the S&P SmallCap 600 Growth Index before fees and expenses. The S&P SmallCap 600 Growth Index measures the performance of the small-capitalization growth sector of the U.S. equity market.
The ETF has lost about -1.13% so far this year and is down about -2.73% in the last one year (as of 05/16/2023). In the past 52-week period, it has traded between $100.74 and $123.41.
The ETF has a beta of 1.13 and standard deviation of 24.37% for the trailing three-year period, making it a medium risk choice in the space. With about 387 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares S&P Small-Cap 600 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, IJT is a great option for investors seeking exposure to the Style Box - Small Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Growth ETF (IWO - Free Report) and the Vanguard Small-Cap Growth ETF (VBK - Free Report) track a similar index. While iShares Russell 2000 Growth ETF has $9.35 billion in assets, Vanguard Small-Cap Growth ETF has $13.19 billion. IWO has an expense ratio of 0.23% and VBK 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 S&P Small-Cap 600 Growth ETF (IJT) Be on Your Investing Radar?
Looking for broad exposure to the Small Cap Growth segment of the US equity market? You should consider the iShares S&P Small-Cap 600 Growth ETF (IJT - Free Report) , a passively managed exchange traded fund launched on 07/24/2000.
The fund is sponsored by Blackrock. It has amassed assets over $4.77 billion, making it one of the larger ETFs attempting to match the Small Cap Growth segment of the US equity market.
Why Small Cap Growth
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Further, growth stocks have a higher level of volatility associated with them. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.18%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.17%.
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 Industrials sector--about 19.20% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Applied Industrial Technologies In (AIT - Free Report) accounts for about 1.18% of total assets, followed by Sps Commerce Inc (SPSC - Free Report) and Rambus Inc (RMBS - Free Report) .
The top 10 holdings account for about 10.42% of total assets under management.
Performance and Risk
IJT seeks to match the performance of the S&P SmallCap 600 Growth Index before fees and expenses. The S&P SmallCap 600 Growth Index measures the performance of the small-capitalization growth sector of the U.S. equity market.
The ETF has lost about -1.13% so far this year and is down about -2.73% in the last one year (as of 05/16/2023). In the past 52-week period, it has traded between $100.74 and $123.41.
The ETF has a beta of 1.13 and standard deviation of 24.37% for the trailing three-year period, making it a medium risk choice in the space. With about 387 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares S&P Small-Cap 600 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, IJT is a great option for investors seeking exposure to the Style Box - Small Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Growth ETF (IWO - Free Report) and the Vanguard Small-Cap Growth ETF (VBK - Free Report) track a similar index. While iShares Russell 2000 Growth ETF has $9.35 billion in assets, Vanguard Small-Cap Growth ETF has $13.19 billion. IWO has an expense ratio of 0.23% and VBK 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.