If you're interested in broad exposure to the Large Cap Blend segment of the US equity market, look no further than the IQ U.S. Large Cap ETF , a passively managed exchange traded fund launched on 12/13/2017.
The fund is sponsored by New York Life Investments. It has amassed assets over $229.57 million, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
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.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
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 0.25%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.59%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. 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 22.70% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Broadcom Inc (
AVGO Quick Quote AVGO - Free Report) accounts for about 1.34% of total assets, followed by Eaton Corp Plc ( ETN Quick Quote ETN - Free Report) and Oracle Corp ( ORCL Quick Quote ORCL - Free Report) .
The top 10 holdings account for about 12.26% of total assets under management.
Performance and Risk
CLRG seeks to match the performance of the NASDAQ CHAIKIN POWER US LARGE CAP INDEX before fees and expenses. The NASDAQ Chaikin Power US Large Cap Index applies a quantitative multi-factor model that seeks to identify securities that are expected to outperform peers by selecting securities from the Nasdaq US 300 Index.
The ETF has added about 7.72% so far this year and is up about 7.39% in the last one year (as of 11/20/2023). In the past 52-week period, it has traded between $30.87 and $34.10.
The ETF has a beta of 1.03 and standard deviation of 16.58% for the trailing three-year period. With about 101 holdings, it effectively diversifies company-specific risk.
IQ U.S. Large Cap 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, CLRG is a reasonable option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (
IVV Quick Quote IVV - Free Report) and the SPDR S&P 500 ETF ( SPY Quick Quote SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $370.10 billion in assets, SPDR S&P 500 ETF has $423.87 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%. Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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.