We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Should You Invest in the iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI)?
Read MoreHide Full Article
Designed to provide broad exposure to the Financials - Brokers/ Capital markets segment of the equity market, the iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI - Free Report) is a passively managed exchange traded fund launched on 05/01/2006.
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.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Financials - Brokers/ Capital markets is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 9, placing it in bottom 44%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $1.17 billion, making it one of the larger ETFs attempting to match the performance of the Financials - Brokers/ Capital markets segment of the equity market. IAI seeks to match the performance of the Dow Jones U.S. Select Investment Services Index before fees and expenses.
The Dow Jones U.S. Select Investment Services Index measures the performance of the investment services sector of the U.S. equity market.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.40%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.39%.
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 100% of the portfolio.
Looking at individual holdings, Goldman Sachs Group Inc- (GS - Free Report) accounts for about 14.53% of total assets, followed by S&p Global Inc- (SPGI - Free Report) and Morgan Stanley- (MS - Free Report) .
The top 10 holdings account for about 71.49% of total assets under management.
Performance and Risk
The ETF has added roughly 15.28% and it's up approximately 35.79% so far this year and in the past one year (as of 07/17/2024), respectively. IAI has traded between $85.18 and $124.40 during this last 52-week period.
The ETF has a beta of 1.12 and standard deviation of 20.57% for the trailing three-year period, making it a high risk choice in the space. With about 38 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Broker-Dealers & Securities Exchanges ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. IAI, then, is not a suitable option for investors seeking exposure to the Financials ETFs segment of the market. However, there are better ETFs in the space to consider.
SPDR S&P Capital Markets ETF (KCE - Free Report) tracks S&P Capital Markets Select Industry Index. The fund has $457.73 million in assets. KCE has an expense ratio of 0.35%.
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.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Should You Invest in the iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI)?
Designed to provide broad exposure to the Financials - Brokers/ Capital markets segment of the equity market, the iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI - Free Report) is a passively managed exchange traded fund launched on 05/01/2006.
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.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Financials - Brokers/ Capital markets is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 9, placing it in bottom 44%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $1.17 billion, making it one of the larger ETFs attempting to match the performance of the Financials - Brokers/ Capital markets segment of the equity market. IAI seeks to match the performance of the Dow Jones U.S. Select Investment Services Index before fees and expenses.
The Dow Jones U.S. Select Investment Services Index measures the performance of the investment services sector of the U.S. equity market.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.40%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.39%.
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 100% of the portfolio.
Looking at individual holdings, Goldman Sachs Group Inc- (GS - Free Report) accounts for about 14.53% of total assets, followed by S&p Global Inc- (SPGI - Free Report) and Morgan Stanley- (MS - Free Report) .
The top 10 holdings account for about 71.49% of total assets under management.
Performance and Risk
The ETF has added roughly 15.28% and it's up approximately 35.79% so far this year and in the past one year (as of 07/17/2024), respectively. IAI has traded between $85.18 and $124.40 during this last 52-week period.
The ETF has a beta of 1.12 and standard deviation of 20.57% for the trailing three-year period, making it a high risk choice in the space. With about 38 holdings, it has more concentrated exposure than peers.
Alternatives
IShares U.S. Broker-Dealers & Securities Exchanges ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. IAI, then, is not a suitable option for investors seeking exposure to the Financials ETFs segment of the market. However, there are better ETFs in the space to consider.
SPDR S&P Capital Markets ETF (KCE - Free Report) tracks S&P Capital Markets Select Industry Index. The fund has $457.73 million in assets. KCE has an expense ratio of 0.35%.
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.