Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the iShares Russell Top 200 ETF (
IWL Quick Quote IWL - Free Report) , a passively managed exchange traded fund launched on 09/22/2009.
The fund is sponsored by Blackrock. It has amassed assets over $567.23 million, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain 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 2.04%.
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 Information Technology sector--about 28.10% of the portfolio. Healthcare and Telecom round out the top three.
Looking at individual holdings, Microsoft Corp (
MSFT Quick Quote MSFT - Free Report) accounts for about 6.95% of total assets, followed by Apple Inc ( AAPL Quick Quote AAPL - Free Report) and Amazon Com Inc ( AMZN Quick Quote AMZN - Free Report) .
The top 10 holdings account for about 31.61% of total assets under management.
Performance and Risk
IWL seeks to match the performance of the Russell Top 200 Index before fees and expenses. The Russell Top 200 Index is a float-adjusted, capitalization-weighted index that measures the performance of the largest capitalization sector of the U.S. equity market.
The ETF has lost about -9.38% so far this year and is up roughly 1.36% in the last one year (as of 05/27/2020). In the past 52-week period, it has traded between $53.58 and $79.63.
The ETF has a beta of 0.98 and standard deviation of 21.68% for the trailing three-year period, making it a medium risk choice in the space. With about 200 holdings, it effectively diversifies company-specific risk.
IShares Russell Top 200 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, IWL is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Core SP 500 ETF (
IVV Quick Quote IVV - Free Report) and the SPDR SP 500 ETF ( SPY Quick Quote SPY - Free Report) track a similar index. While iShares Core SP 500 ETF has $186.25 billion in assets, SPDR SP 500 ETF has $265.79 billion. IVV has an expense ratio of 0.04% and SPY charges 0.09%. Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are 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.