We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Should iShares MSCI USA Value Factor ETF (VLUE) Be on Your Investing Radar?
Read MoreHide Full Article
Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the iShares MSCI USA Value Factor ETF (VLUE - Free Report) is a passively managed exchange traded fund launched on 04/16/2013.
The fund is sponsored by Blackrock. It has amassed assets over $7.05 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
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.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their 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
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 0.15%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.47%.
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 Information Technology sector--about 32% of the portfolio. Financials and Healthcare round out the top three.
Looking at individual holdings, Cisco Systems Inc- (CSCO - Free Report) accounts for about 5.50% of total assets, followed by At&t Inc- (T - Free Report) and Intel Corporation Corp- (INTC - Free Report) .
The top 10 holdings account for about 35.18% of total assets under management.
Performance and Risk
VLUE seeks to match the performance of the MSCI USA Enhanced Value Index before fees and expenses. The MSCI USA Enhanced Value Index is based on a traditional market capitalization-weighted parent index, the MSCI USA Index which includes U.S. large and mid capitalization stocks.
The ETF return is roughly 5.90% so far this year and is up about 14.13% in the last one year (as of 07/12/2024). In the past 52-week period, it has traded between $85.95 and $108.31.
The ETF has a beta of 1.01 and standard deviation of 17.29% for the trailing three-year period, making it a medium risk choice in the space. With about 154 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI USA Value Factor 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, VLUE is a great option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $56.79 billion in assets, Vanguard Value ETF has $117.85 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Should iShares MSCI USA Value Factor ETF (VLUE) Be on Your Investing Radar?
Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the iShares MSCI USA Value Factor ETF (VLUE - Free Report) is a passively managed exchange traded fund launched on 04/16/2013.
The fund is sponsored by Blackrock. It has amassed assets over $7.05 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
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.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their 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
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 0.15%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.47%.
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 Information Technology sector--about 32% of the portfolio. Financials and Healthcare round out the top three.
Looking at individual holdings, Cisco Systems Inc- (CSCO - Free Report) accounts for about 5.50% of total assets, followed by At&t Inc- (T - Free Report) and Intel Corporation Corp- (INTC - Free Report) .
The top 10 holdings account for about 35.18% of total assets under management.
Performance and Risk
VLUE seeks to match the performance of the MSCI USA Enhanced Value Index before fees and expenses. The MSCI USA Enhanced Value Index is based on a traditional market capitalization-weighted parent index, the MSCI USA Index which includes U.S. large and mid capitalization stocks.
The ETF return is roughly 5.90% so far this year and is up about 14.13% in the last one year (as of 07/12/2024). In the past 52-week period, it has traded between $85.95 and $108.31.
The ETF has a beta of 1.01 and standard deviation of 17.29% for the trailing three-year period, making it a medium risk choice in the space. With about 154 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI USA Value Factor 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, VLUE is a great option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 1000 Value ETF (IWD - Free Report) and the Vanguard Value ETF (VTV - Free Report) track a similar index. While iShares Russell 1000 Value ETF has $56.79 billion in assets, Vanguard Value ETF has $117.85 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
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.