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Should iShares Morningstar Mid-Cap Value ETF (JKI) Be on Your Investing Radar?
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The iShares Morningstar Mid-Cap Value ETF was launched on 06/28/2004, and is a passively managed exchange traded fund designed to offer broad exposure to the Mid Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $460.62 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, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus, companies that fall under this category provide a stable and growth-heavy investment.
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. 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
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
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 2.09%.
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 19.20% of the portfolio. Utilities and Consumer Discretionary round out the top three.
Looking at individual holdings, Welltower Inc (WELL - Free Report) accounts for about 1.29% of total assets, followed by Kroger (KR - Free Report) and Andeavor .
The top 10 holdings account for about 11.73% 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 2.94% so far this year and was up about 8.70% in the last one year (as of 10/03/2018). In the past 52-week period, it has traded between $151.36 and $168.36.
The ETF has a beta of 0.91 and standard deviation of 13.01% for the trailing three-year period, making it a medium risk choice in the space. With about 186 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 good 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 $9.51 B in assets, iShares Russell Mid-Cap Value ETF has $11.29 B. VOE has an expense ratio of 0.07% and IWS charges 0.25%.
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.
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Should iShares Morningstar Mid-Cap Value ETF (JKI) Be on Your Investing Radar?
The iShares Morningstar Mid-Cap Value ETF was launched on 06/28/2004, and is a passively managed exchange traded fund designed to offer broad exposure to the Mid Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $460.62 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, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus, companies that fall under this category provide a stable and growth-heavy investment.
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. 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
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
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 2.09%.
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 19.20% of the portfolio. Utilities and Consumer Discretionary round out the top three.
Looking at individual holdings, Welltower Inc (WELL - Free Report) accounts for about 1.29% of total assets, followed by Kroger (KR - Free Report) and Andeavor .
The top 10 holdings account for about 11.73% 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 2.94% so far this year and was up about 8.70% in the last one year (as of 10/03/2018). In the past 52-week period, it has traded between $151.36 and $168.36.
The ETF has a beta of 0.91 and standard deviation of 13.01% for the trailing three-year period, making it a medium risk choice in the space. With about 186 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 good 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 $9.51 B in assets, iShares Russell Mid-Cap Value ETF has $11.29 B. VOE has an expense ratio of 0.07% and IWS charges 0.25%.
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.