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Is iShares MSCI ACWI Low Carbon Target ETF (CRBN) a Hot ETF Right Now?
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Making its debut on 12/08/2014, smart beta exchange traded fund iShares MSCI ACWI Low Carbon Target ETF (CRBN - Free Report) provides investors broad exposure to the World ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Because the fund has amassed over $531.23 M, this makes it one of the larger ETFs in the World ETFs. CRBN is managed by Blackrock. Before fees and expenses, CRBN seeks to match the performance of the MSCI ACWI Low Carbon Target Index.
The MSCI ACWI Low Carbon Target Index is designed to address two dimensions of carbon exposure ? carbon emissions and potential carbon emissions from fossil fuel reserves.
Cost & Other Expenses
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 cousins, other things remaining the same.
Annual operating expenses for CRBN are 0.20%, which makes it one of the least expensive products in the space.
CRBN's 12-month trailing dividend yield is 2.16%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Taking into account individual holdings, Apple Inc (AAPL - Free Report) accounts for about 2.44% of the fund's total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon Com Inc (AMZN - Free Report) .
The top 10 holdings account for about 11.26% of total assets under management.
Performance and Risk
Year-to-date, the iShares MSCI ACWI Low Carbon Target ETF has added about 2.09% so far, and it's up approximately 6.55% over the last 12 months (as of 10/09/2018). CRBN has traded between $113.41 and $125.90 in this past 52-week period.
The fund has a beta of 0.98 and standard deviation of 11.54% for the trailing three-year period, which makes CRBN a low risk choice in this particular space. With about 1223 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI ACWI Low Carbon Target ETF is a reasonable option for investors seeking to outperform the World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI USA ESG Select ETF (SUSA - Free Report) tracks MSCI USA ESG Select Index and the iShares MSCI KLD 400 Social ETF (DSI - Free Report) tracks MSCI KLD 400 Social Index. IShares MSCI USA ESG Select ETF has $780.73 M in assets, iShares MSCI KLD 400 Social ETF has $1.24 B. SUSA has an expense ratio of 0.25% and DSI charges 0.25%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the World ETFs.
Bottom Line
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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Is iShares MSCI ACWI Low Carbon Target ETF (CRBN) a Hot ETF Right Now?
Making its debut on 12/08/2014, smart beta exchange traded fund iShares MSCI ACWI Low Carbon Target ETF (CRBN - Free Report) provides investors broad exposure to the World ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Because the fund has amassed over $531.23 M, this makes it one of the larger ETFs in the World ETFs. CRBN is managed by Blackrock. Before fees and expenses, CRBN seeks to match the performance of the MSCI ACWI Low Carbon Target Index.
The MSCI ACWI Low Carbon Target Index is designed to address two dimensions of carbon exposure ? carbon emissions and potential carbon emissions from fossil fuel reserves.
Cost & Other Expenses
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 cousins, other things remaining the same.
Annual operating expenses for CRBN are 0.20%, which makes it one of the least expensive products in the space.
CRBN's 12-month trailing dividend yield is 2.16%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Taking into account individual holdings, Apple Inc (AAPL - Free Report) accounts for about 2.44% of the fund's total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon Com Inc (AMZN - Free Report) .
The top 10 holdings account for about 11.26% of total assets under management.
Performance and Risk
Year-to-date, the iShares MSCI ACWI Low Carbon Target ETF has added about 2.09% so far, and it's up approximately 6.55% over the last 12 months (as of 10/09/2018). CRBN has traded between $113.41 and $125.90 in this past 52-week period.
The fund has a beta of 0.98 and standard deviation of 11.54% for the trailing three-year period, which makes CRBN a low risk choice in this particular space. With about 1223 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI ACWI Low Carbon Target ETF is a reasonable option for investors seeking to outperform the World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares MSCI USA ESG Select ETF (SUSA - Free Report) tracks MSCI USA ESG Select Index and the iShares MSCI KLD 400 Social ETF (DSI - Free Report) tracks MSCI KLD 400 Social Index. IShares MSCI USA ESG Select ETF has $780.73 M in assets, iShares MSCI KLD 400 Social ETF has $1.24 B. SUSA has an expense ratio of 0.25% and DSI charges 0.25%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the World ETFs.
Bottom Line
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.