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Should iShares Morningstar Small-Cap ETF (ISCB) Be on Your Investing Radar?
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Designed to provide broad exposure to the Small Cap Blend segment of the US equity market, the iShares Morningstar Small-Cap ETF (ISCB - Free Report) is a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $221.05 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
Small cap companies have market capitalization below $2 billion. They usually have higher potential than large and mid cap companies with stocks but higher risk.
Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.
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 0.04%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.39%.
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 Industrials sector--about 18.60% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Topbuild Corp (BLD - Free Report) accounts for about 0.29% of total assets, followed by Sarepta Therapeutics Inc (SRPT - Free Report) and Karuna Therapeutics Inc (KRTX).
The top 10 holdings account for about 2.66% of total assets under management.
Performance and Risk
ISCB seeks to match the performance of the MORNINGSTAR US SMALL CAP EXTENDED INDEX before fees and expenses. The Morningstar US Small Cap Extended Index comprises of small-capitalization U.S. equities.
The ETF has added roughly 2.09% so far this year and was up about 20.62% in the last one year (as of 04/08/2024). In the past 52-week period, it has traded between $43.13 and $56.21.
The ETF has a beta of 1.17 and standard deviation of 21.98% for the trailing three-year period. With about 1626 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Small-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, ISCB is a good option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $63.01 billion in assets, iShares Core S&P Small-Cap ETF has $78.19 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
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.
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Should iShares Morningstar Small-Cap ETF (ISCB) Be on Your Investing Radar?
Designed to provide broad exposure to the Small Cap Blend segment of the US equity market, the iShares Morningstar Small-Cap ETF (ISCB - Free Report) is a passively managed exchange traded fund launched on 06/28/2004.
The fund is sponsored by Blackrock. It has amassed assets over $221.05 million, making it one of the average sized ETFs attempting to match the Small Cap Blend segment of the US equity market.
Why Small Cap Blend
Small cap companies have market capitalization below $2 billion. They usually have higher potential than large and mid cap companies with stocks but higher risk.
Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.
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 0.04%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.39%.
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 Industrials sector--about 18.60% of the portfolio. Financials and Consumer Discretionary round out the top three.
Looking at individual holdings, Topbuild Corp (BLD - Free Report) accounts for about 0.29% of total assets, followed by Sarepta Therapeutics Inc (SRPT - Free Report) and Karuna Therapeutics Inc (KRTX).
The top 10 holdings account for about 2.66% of total assets under management.
Performance and Risk
ISCB seeks to match the performance of the MORNINGSTAR US SMALL CAP EXTENDED INDEX before fees and expenses. The Morningstar US Small Cap Extended Index comprises of small-capitalization U.S. equities.
The ETF has added roughly 2.09% so far this year and was up about 20.62% in the last one year (as of 04/08/2024). In the past 52-week period, it has traded between $43.13 and $56.21.
The ETF has a beta of 1.17 and standard deviation of 21.98% for the trailing three-year period. With about 1626 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Small-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, ISCB is a good option for those seeking exposure to the Style Box - Small Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 ETF (IWM - Free Report) and the iShares Core S&P Small-Cap ETF (IJR - Free Report) track a similar index. While iShares Russell 2000 ETF has $63.01 billion in assets, iShares Core S&P Small-Cap ETF has $78.19 billion. IWM has an expense ratio of 0.19% and IJR charges 0.06%.
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.