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Should iShares Core S&P MidCap ETF (IJH) Be on Your Investing Radar?

If you're interested in broad exposure to the Mid Cap Blend segment of the US equity market, look no further than the iShares Core S&P MidCap ETF (IJH), a passively managed exchange traded fund launched on 05/22/2000.

The fund is sponsored by Blackrock. It has amassed assets over $63.33 billion, making it the largest ETFs attempting to match the Mid Cap Blend segment of the US equity market.

Why Mid Cap Blend

Compared to large and small cap companies, mid cap businesses tend to have higher growth prospects and are less volatile, respectively, with market capitalization between $2 billion and $10 billion. Thus, companies that fall under this category provide a stable and growth-heavy investment.

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Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.

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 0.05%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.42%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Industrials sector--about 19.40% of the portfolio. Financials and Consumer Discretionary round out the top three.

Looking at individual holdings, Targa Resources Corp (TRGP) accounts for about 0.66% of total assets, followed by Carlisle Companies Inc (CSL) and Steel Dynamics Inc (STLD).

The top 10 holdings account for about 5.76% of total assets under management.

Performance and Risk

IJH seeks to match the performance of the S&P MidCap 400 Index before fees and expenses. The S&P MidCap 400 Index measures the performance of the mid-capitalization sector of the U.S. equity market.

The ETF has lost about -10.55% so far this year and is down about -4.67% in the last one year (as of 09/13/2022). In the past 52-week period, it has traded between $219.07 and $290.54.

The ETF has a beta of 1.12 and standard deviation of 28.87% for the trailing three-year period, making it a medium risk choice in the space. With about 409 holdings, it effectively diversifies company-specific risk.

Alternatives

IShares Core S&P MidCap 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, IJH is a good option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The iShares Russell MidCap ETF (IWR) and the Vanguard MidCap ETF (VO) track a similar index. While iShares Russell MidCap ETF has $28.64 billion in assets, Vanguard MidCap ETF has $51.99 billion. IWR has an expense ratio of 0.18% and VO charges 0.04%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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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iShares Core S&P MidCap ETF (IJH): ETF Research Reports
 
Steel Dynamics, Inc. (STLD) : Free Stock Analysis Report
 
Carlisle Companies Incorporated (CSL) : Free Stock Analysis Report
 
Targa Resources, Inc. (TRGP) : Free Stock Analysis Report
 
Vanguard MidCap ETF (VO): ETF Research Reports
 
iShares Russell MidCap ETF (IWR): ETF Research Reports
 
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Zacks Investment Research