Launched on June 28, 2004, the iShares Morningstar Small-Cap Value ETF (ISCV Quick QuoteISCV - 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 $687.37 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.

Why Small Cap Value

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.

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. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.

Costs

Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.

Annual operating expenses for this ETF are 0.06%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.92%.

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 24.3% of the portfolio. Consumer Discretionary and Industrials round out the top three.

Looking at individual holdings, Best Buy (BBY) accounts for about 0.58% of total assets, followed by Skyworks Solutions (SWKS) and Hf Sinclair (DINO).

Performance and Risk

ISCV seeks to match the performance of the MORNINGSTAR US SML CP BRD VLUE EXTD INDX before fees and expenses. The Morningstar US Small Cap Broad Value Extended Index comprises of small-capitalization U.S. equities that exhibit value characteristics.

The ETF has added about 15.19% so far this year and it's up approximately 21.25% in the last one year (as of 11/09/2026). In the past 52-week period, it has traded between $63.71 and $81.79.

The ETF has a beta of 1.02 and standard deviation of 18.68% for the trailing three-year period. With about 1048 holdings, it effectively diversifies company-specific risk.

Alternatives

iShares Morningstar Small-Cap Value 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, ISCV is a great 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 Russell 2000 Value ETF (IWN) and the Vanguard Morningstar Small-Cap Value ETF (VBR) track a similar index. While iShares Russell 2000 Value ETF has $13.86 billion in assets, Vanguard Morningstar Small-Cap Value ETF has $36.90 billion. IWN has an expense ratio of 0.24% and VBR charges 0.05%.

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.