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Should iShares Russell Top 200 Growth ETF (IWY) Be on Your Investing Radar?
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The iShares Russell Top 200 Growth ETF (IWY - Free Report) was launched on 09/22/2009, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $7.03 billion, making it one of the larger ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. Even though growth stocks are more likely to outperform their value counterparts in strong bull markets, value stocks have a record of delivering better returns in almost all markets than growth stocks.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.20%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.72%.
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 to the Information Technology sector--about 44.90% of the portfolio. Consumer Discretionary and Telecom round out the top three.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 15.31% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon Com Inc (AMZN - Free Report) .
The top 10 holdings account for about 44.46% of total assets under management.
Performance and Risk
IWY seeks to match the performance of the Russell Top 200 Growth Index before fees and expenses. The Russell Top 200 Growth Index is a style factor weighted index that measures the performance of the largest capitalization growth sector of the U.S. equity market. It is a subset of the Russell Top 200 Index issuers with relatively higher price-to-book ratios and higher forecasted growth, which measures the performance of the largest capitalization sector of the U.S. equity market.
The ETF has added roughly 30.42% so far this year and was up about 7.40% in the last one year (as of 08/17/2023). In the past 52-week period, it has traded between $117.55 and $164.44.
The ETF has a beta of 1.07 and standard deviation of 22.97% for the trailing three-year period, making it a medium risk choice in the space. With about 117 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Russell Top 200 Growth 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, IWY is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $90.16 billion in assets, Invesco QQQ has $198.13 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
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 Russell Top 200 Growth ETF (IWY) Be on Your Investing Radar?
The iShares Russell Top 200 Growth ETF (IWY - Free Report) was launched on 09/22/2009, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $7.03 billion, making it one of the larger ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. Even though growth stocks are more likely to outperform their value counterparts in strong bull markets, value stocks have a record of delivering better returns in almost all markets than growth stocks.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.20%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.72%.
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 to the Information Technology sector--about 44.90% of the portfolio. Consumer Discretionary and Telecom round out the top three.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 15.31% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Amazon Com Inc (AMZN - Free Report) .
The top 10 holdings account for about 44.46% of total assets under management.
Performance and Risk
IWY seeks to match the performance of the Russell Top 200 Growth Index before fees and expenses. The Russell Top 200 Growth Index is a style factor weighted index that measures the performance of the largest capitalization growth sector of the U.S. equity market. It is a subset of the Russell Top 200 Index issuers with relatively higher price-to-book ratios and higher forecasted growth, which measures the performance of the largest capitalization sector of the U.S. equity market.
The ETF has added roughly 30.42% so far this year and was up about 7.40% in the last one year (as of 08/17/2023). In the past 52-week period, it has traded between $117.55 and $164.44.
The ETF has a beta of 1.07 and standard deviation of 22.97% for the trailing three-year period, making it a medium risk choice in the space. With about 117 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Russell Top 200 Growth 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, IWY is an outstanding option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $90.16 billion in assets, Invesco QQQ has $198.13 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
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.