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Should iShares Morningstar Small-Cap Value ETF (ISCV) Be on Your Investing Radar?
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Launched on 06/28/2004, the iShares Morningstar Small-Cap Value ETF (ISCV - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $412.11 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
Small cap companies have market capitalization below $2 billion. They usually have higher potential than large and mid cap companies with stocks but higher risk.
While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.06%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.10%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 27.60% of the portfolio. Consumer Discretionary and Industrials round out the top three.
Looking at individual holdings, Rivian Automotive Inc Class A- (RIVN - Free Report) accounts for about 0.53% of total assets, followed by Chord Energy Corp- (CHRD - Free Report) and Ch Robinson Worldwide Inc- (CHRW - Free Report) .
The top 10 holdings account for about 4.52% of total assets under management.
Performance and Risk
ISCV seeks to match the performance of the MORNINGSTAR US SML CP BRD VLUE EXTD INDX before fees and expenses. The Morningstar US Small Cap Broad Value Extended Index comprises of small-capitalization U.S. equities that exhibit value characteristics.
The ETF has added about 2.42% so far this year and is up roughly 7.83% in the last one year (as of 08/05/2024). In the past 52-week period, it has traded between $47.77 and $63.74.
The ETF has a beta of 1.25 and standard deviation of 21.14% for the trailing three-year period. With about 1138 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Small-Cap Value ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, ISCV is a sufficient option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The Avantis U.S. Small Cap Value ETF (AVUV - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While Avantis U.S. Small Cap Value ETF has $12.29 billion in assets, Vanguard Small-Cap Value ETF has $28.42 billion. AVUV has an expense ratio of 0.25% and VBR charges 0.07%.
Bottom-Line
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.
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 Morningstar Small-Cap Value ETF (ISCV) Be on Your Investing Radar?
Launched on 06/28/2004, the iShares Morningstar Small-Cap Value ETF (ISCV - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Blackrock. It has amassed assets over $412.11 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
Small cap companies have market capitalization below $2 billion. They usually have higher potential than large and mid cap companies with stocks but higher risk.
While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.06%, making it the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.10%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 27.60% of the portfolio. Consumer Discretionary and Industrials round out the top three.
Looking at individual holdings, Rivian Automotive Inc Class A- (RIVN - Free Report) accounts for about 0.53% of total assets, followed by Chord Energy Corp- (CHRD - Free Report) and Ch Robinson Worldwide Inc- (CHRW - Free Report) .
The top 10 holdings account for about 4.52% of total assets under management.
Performance and Risk
ISCV seeks to match the performance of the MORNINGSTAR US SML CP BRD VLUE EXTD INDX before fees and expenses. The Morningstar US Small Cap Broad Value Extended Index comprises of small-capitalization U.S. equities that exhibit value characteristics.
The ETF has added about 2.42% so far this year and is up roughly 7.83% in the last one year (as of 08/05/2024). In the past 52-week period, it has traded between $47.77 and $63.74.
The ETF has a beta of 1.25 and standard deviation of 21.14% for the trailing three-year period. With about 1138 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Morningstar Small-Cap Value ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, ISCV is a sufficient option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The Avantis U.S. Small Cap Value ETF (AVUV - Free Report) and the Vanguard Small-Cap Value ETF (VBR - Free Report) track a similar index. While Avantis U.S. Small Cap Value ETF has $12.29 billion in assets, Vanguard Small-Cap Value ETF has $28.42 billion. AVUV has an expense ratio of 0.25% and VBR charges 0.07%.
Bottom-Line
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.
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.