Is iShares Core S&P U.S. Value ETF (IUSV) a Strong ETF Right Now?
Smart Beta ETF report for IUSV
Making its debut on 07/24/2000, smart beta exchange traded fund iShares Core S&P U.S. Value ETF (IUSV) provides investors broad exposure to the Style Box - All Cap Value category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
Managed by Blackrock, IUSV has amassed assets over $11.14 billion, making it the largest ETF in the Style Box - All Cap Value. Before fees and expenses, IUSV seeks to match the performance of the S&P 900 Value Index.
The S&P 900 Value Index measures the performance of the large and mid-capitalization value sector of the U.S. equity market.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.04%, making it the least expensive product in the space.
It has a 12-month trailing dividend yield of 1.94%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Financials sector - about 21.20% of the portfolio. Industrials and Healthcare round out the top three.
Taking into account individual holdings, Berkshire Hathaway Inc Class B (BRK.B) accounts for about 2.84% of the fund's total assets, followed by Jpmorgan Chase & Co (JPM) and Walt Disney (DIS).
The top 10 holdings account for about 16.56% of total assets under management.
Performance and Risk
The ETF has added roughly 23.55% so far this year and it's up approximately 34.93% in the last one year (as of 10/25/2021). In the past 52-week period, it has traded between $53.17 and $74.67.
The fund has a beta of 1.02 and standard deviation of 23.32% for the trailing three-year period, which makes IUSV a medium risk choice in this particular space. With about 750 holdings, it effectively diversifies company-specific risk.
IShares Core S&P U.S. Value ETF is an excellent option for investors seeking to outperform the Style Box - All Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
Invesco High Yield Equity Dividend Achievers ETF (PEY) tracks NASDAQ US Dividend Achievers 50 Index and the Dimensional U.S. Targeted Value ETF (DFAT) tracks ----------------------------------------. Invesco High Yield Equity Dividend Achievers ETF has $977.16 million in assets, Dimensional U.S. Targeted Value ETF has $6.43 billion. PEY has an expense ratio of 0.52% and DFAT charges 0.34%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - All Cap Value.
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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iShares Core S&P U.S. Value ETF (IUSV): ETF Research Reports
JPMorgan Chase & Co. (JPM): Free Stock Analysis Report
Berkshire Hathaway Inc. (BRK.B): Free Stock Analysis Report
The Walt Disney Company (DIS): Free Stock Analysis Report
Invesco High Yield Equity Dividend Achievers ETF (PEY): ETF Research Reports
Dimensional U.S. Targeted Value ETF (DFAT): ETF Research Reports
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