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Should iShares Morningstar Mid-Cap Value ETF (JKI) Be on Your Investing Radar?
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Launched on 06/28/2004, the iShares Morningstar Mid-Cap Value ETF is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $438.32 M, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. These types of companies, then, have a good balance of stability and growth potential.
While 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. When you look at long-term performance, value stocks have outperformed growth stocks in nearly all markets. But in strong bull markets, growth stocks are more likely to be winners.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.30%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.99%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 19.40% of the portfolio. Consumer Discretionary and Utilities round out the top three.
Looking at individual holdings, Welltower Inc (WELL - Free Report) accounts for about 1.30% of total assets, followed by Devon Energy Corp (DVN - Free Report) and Kroger (KR - Free Report) .
The top 10 holdings account for about 11.83% of total assets under management.
Performance and Risk
JKI seeks to match the performance of the Morningstar Mid Value Index before fees and expenses. The Morningstar Mid Value Index measures the performance of stocks issued by mid-capitalization companies.
The ETF has added roughly 2.80% so far this year and was up about 10.72% in the last one year (as of 07/31/2018). In the past 52-week period, it has traded between $144.45 and $168.36.
The ETF has a beta of 0.95 and standard deviation of 13.92% for the trailing three-year period, making it a medium risk choice in the space. With about 184 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Mid-Cap Value 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, JKI is a reasonable option for those seeking exposure to the Mid Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Mid-Cap Value ETF (VOE - Free Report) and the iShares Russell Mid-Cap Value ETF (IWS - Free Report) track a similar index. While Vanguard Mid-Cap Value ETF has $8.98 B in assets, iShares Russell Mid-Cap Value ETF has $11.13 B. VOE has an expense ratio of 0.07% and IWS charges 0.25%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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 Morningstar Mid-Cap Value ETF (JKI) Be on Your Investing Radar?
Launched on 06/28/2004, the iShares Morningstar Mid-Cap Value ETF is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $438.32 M, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. These types of companies, then, have a good balance of stability and growth potential.
While 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. When you look at long-term performance, value stocks have outperformed growth stocks in nearly all markets. But in strong bull markets, growth stocks are more likely to be winners.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.30%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.99%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 19.40% of the portfolio. Consumer Discretionary and Utilities round out the top three.
Looking at individual holdings, Welltower Inc (WELL - Free Report) accounts for about 1.30% of total assets, followed by Devon Energy Corp (DVN - Free Report) and Kroger (KR - Free Report) .
The top 10 holdings account for about 11.83% of total assets under management.
Performance and Risk
JKI seeks to match the performance of the Morningstar Mid Value Index before fees and expenses. The Morningstar Mid Value Index measures the performance of stocks issued by mid-capitalization companies.
The ETF has added roughly 2.80% so far this year and was up about 10.72% in the last one year (as of 07/31/2018). In the past 52-week period, it has traded between $144.45 and $168.36.
The ETF has a beta of 0.95 and standard deviation of 13.92% for the trailing three-year period, making it a medium risk choice in the space. With about 184 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Mid-Cap Value 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, JKI is a reasonable option for those seeking exposure to the Mid Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard Mid-Cap Value ETF (VOE - Free Report) and the iShares Russell Mid-Cap Value ETF (IWS - Free Report) track a similar index. While Vanguard Mid-Cap Value ETF has $8.98 B in assets, iShares Russell Mid-Cap Value ETF has $11.13 B. VOE has an expense ratio of 0.07% and IWS charges 0.25%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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.