Yahoo Finance Should iShares S&P Mid-Cap 400 Value ETF (IJJ) Be on Your Investing Radar?
Looking for broad exposure to the Mid Cap Value segment of the US equity market? You should consider the iShares S&P Mid-Cap 400 Value ETF (IJJ), a passively managed exchange traded fund launched on 07/24/2000.
The fund is sponsored by Blackrock. It has amassed assets over $7.34 billion, making it one of the larger ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
With market capitalization between $2 billion and $10 billion, mid cap companies usually contain higher growth prospects than large cap companies, and are considered less risky than their small cap counterparts. These types of companies, then, have a good balance of stability and growth potential.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
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 0.18%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.77%.
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 Financials sector--about 22% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, W. P. Carey Reit Inc (WPC) accounts for about 0.97% of total assets, followed by Reinsurance Group Of America Inc (RGA) and Us Foods Holding Corp (USFD).
The top 10 holdings account for about 8.95% of total assets under management.
Performance and Risk
IJJ seeks to match the performance of the S&P MidCap 400 Value Index before fees and expenses. The S&P MidCap 400 Value Index measures the performance of the mid-capitalization value sector of the U.S. equity market. It is a subset of the S&P MidCap 400 and consists of those stocks in the S&P MidCap 400 exhibiting the strongest value characteristics.
The ETF has lost about -0.07% so far this year and is up roughly 10.18% in the last one year (as of 06/24/2024). In the past 52-week period, it has traded between $93.05 and $118.40.
The ETF has a beta of 1.16 and standard deviation of 19.95% for the trailing three-year period, making it a medium risk choice in the space. With about 310 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares S&P Mid-Cap 400 Value 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, IJJ is a great option for investors seeking exposure to the Style Box - Mid Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell Mid-Cap Value ETF (IWS) and the Vanguard Mid-Cap Value ETF (VOE) track a similar index. While iShares Russell Mid-Cap Value ETF has $12.50 billion in assets, Vanguard Mid-Cap Value ETF has $16.21 billion. IWS has an expense ratio of 0.23% and VOE 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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iShares S&P Mid-Cap 400 Value ETF (IJJ): ETF Research Reports
Reinsurance Group of America, Incorporated (RGA) : Free Stock Analysis Report
W.P. Carey Inc. (WPC) : Free Stock Analysis Report
Vanguard Mid-Cap Value ETF (VOE): ETF Research Reports
US Foods Holding Corp. (USFD) : Free Stock Analysis Report
iShares Russell Mid-Cap Value ETF (IWS): ETF Research Reports
