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Should You Invest in the iShares Expanded Tech Sector ETF (IGM)?
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Designed to provide broad exposure to the Technology - Broad segment of the equity market, the iShares Expanded Tech Sector ETF (IGM - Free Report) is a passively managed exchange traded fund launched on 03/13/2001.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $4.99 billion, making it one of the largest ETFs attempting to match the performance of the Technology - Broad segment of the equity market. IGM seeks to match the performance of the S&P North American Technology Sector Index before fees and expenses.
The S&P North American Expanded Technology Sector Index comprises of North American equities in the technology sector and select North American equities from communication services to consumer discretionary sectors.
Costs
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 counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.41%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.20%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector--about 75.50% of the portfolio, followed by Telecom.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 9.02% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Meta Platforms Inc Class A (META - Free Report) .
The top 10 holdings account for about 55.17% of total assets under management.
Performance and Risk
The ETF return is roughly 27.45% so far this year and was up about 45.84% in the last one year (as of 06/18/2024). In that past 52-week period, it has traded between $60.98 and $95.12.
The ETF has a beta of 1.17 and standard deviation of 25.86% for the trailing three-year period, making it a medium risk choice in the space. With about 283 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Expanded Tech Sector ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IGM is a great option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Technology Select Sector SPDR ETF (XLK - Free Report) tracks Technology Select Sector Index and the Vanguard Information Technology ETF (VGT - Free Report) tracks MSCI US Investable Market Information Technology 25/50 Index. Technology Select Sector SPDR ETF has $72.38 billion in assets, Vanguard Information Technology ETF has $74.61 billion. XLK has an expense ratio of 0.09% and VGT charges 0.10%.
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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Should You Invest in the iShares Expanded Tech Sector ETF (IGM)?
Designed to provide broad exposure to the Technology - Broad segment of the equity market, the iShares Expanded Tech Sector ETF (IGM - Free Report) is a passively managed exchange traded fund launched on 03/13/2001.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $4.99 billion, making it one of the largest ETFs attempting to match the performance of the Technology - Broad segment of the equity market. IGM seeks to match the performance of the S&P North American Technology Sector Index before fees and expenses.
The S&P North American Expanded Technology Sector Index comprises of North American equities in the technology sector and select North American equities from communication services to consumer discretionary sectors.
Costs
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 counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.41%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.20%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector--about 75.50% of the portfolio, followed by Telecom.
Looking at individual holdings, Apple Inc (AAPL - Free Report) accounts for about 9.02% of total assets, followed by Microsoft Corp (MSFT - Free Report) and Meta Platforms Inc Class A (META - Free Report) .
The top 10 holdings account for about 55.17% of total assets under management.
Performance and Risk
The ETF return is roughly 27.45% so far this year and was up about 45.84% in the last one year (as of 06/18/2024). In that past 52-week period, it has traded between $60.98 and $95.12.
The ETF has a beta of 1.17 and standard deviation of 25.86% for the trailing three-year period, making it a medium risk choice in the space. With about 283 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Expanded Tech Sector ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IGM is a great option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Technology Select Sector SPDR ETF (XLK - Free Report) tracks Technology Select Sector Index and the Vanguard Information Technology ETF (VGT - Free Report) tracks MSCI US Investable Market Information Technology 25/50 Index. Technology Select Sector SPDR ETF has $72.38 billion in assets, Vanguard Information Technology ETF has $74.61 billion. XLK has an expense ratio of 0.09% and VGT charges 0.10%.
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.