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Should iShares Russell 2000 Value ETF (IWN) Be on Your Investing Radar?
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Launched on 07/24/2000, the iShares Russell 2000 Value ETF (IWN - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $11.18 billion, making it one of the largest ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however 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 0.23%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.24%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 25% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Stag Industrial Reit Inc (STAG - Free Report) accounts for about 0.55% of total assets, followed by Agree Realty Reit Corp (ADC - Free Report) and Light Wonder Inc (LNW - Free Report) .
The top 10 holdings account for about 4.97% of total assets under management.
Performance and Risk
IWN seeks to match the performance of the Russell 2000 Value Index before fees and expenses. The Russell 2000 Value Index measures the performance of the small-capitalization value sector of the U.S. equity market.
The ETF has added about 1.22% so far this year and is down about -7.22% in the last one year (as of 06/07/2023). In the past 52-week period, it has traded between $128.93 and $159.38.
The ETF has a beta of 1.15 and standard deviation of 24.88% for the trailing three-year period, making it a medium risk choice in the space. With about 1370 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Russell 2000 Value ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IWN is an excellent option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares S&P Small-Cap 600 Value ETF (IJS - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares S&P Small-Cap 600 Value ETF has $6.76 billion in assets, Vanguard Small-Cap Value ETF has $24.06 billion. IJS has an expense ratio of 0.18% and VBR charges 0.07%.
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.
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Should iShares Russell 2000 Value ETF (IWN) Be on Your Investing Radar?
Launched on 07/24/2000, the iShares Russell 2000 Value ETF (IWN - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $11.18 billion, making it one of the largest ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
There's a lot of potential to investing in small cap companies, but with market capitalization below $2 billion, that high potential comes with even higher risk.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however 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 0.23%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.24%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 25% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Stag Industrial Reit Inc (STAG - Free Report) accounts for about 0.55% of total assets, followed by Agree Realty Reit Corp (ADC - Free Report) and Light Wonder Inc (LNW - Free Report) .
The top 10 holdings account for about 4.97% of total assets under management.
Performance and Risk
IWN seeks to match the performance of the Russell 2000 Value Index before fees and expenses. The Russell 2000 Value Index measures the performance of the small-capitalization value sector of the U.S. equity market.
The ETF has added about 1.22% so far this year and is down about -7.22% in the last one year (as of 06/07/2023). In the past 52-week period, it has traded between $128.93 and $159.38.
The ETF has a beta of 1.15 and standard deviation of 24.88% for the trailing three-year period, making it a medium risk choice in the space. With about 1370 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Russell 2000 Value ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IWN is an excellent option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares S&P Small-Cap 600 Value ETF (IJS - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While iShares S&P Small-Cap 600 Value ETF has $6.76 billion in assets, Vanguard Small-Cap Value ETF has $24.06 billion. IJS has an expense ratio of 0.18% and VBR charges 0.07%.
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.