Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the iShares Russell Top 200 Value ETF (IWX) is a passively managed exchange traded fund launched on 09/22/2009.
The fund is sponsored by Blackrock. It has amassed assets over $2.41 billion, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. While value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
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 0.20%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.87%.
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 Financials sector--about 26.20% of the portfolio. Healthcare and Industrials round out the top three.
Looking at individual holdings, Berkshire Hathaway Inc Class B (BRK.B) accounts for about 5.20% of total assets, followed by Jpmorgan Chase & Co (JPM) and Exxon Mobil Corp (XOM).
The top 10 holdings account for about 26.73% of total assets under management.
Performance and Risk
IWX seeks to match the performance of the Russell Top 200 Value Index before fees and expenses. The Russell Top 200 Value Index is a style factor weighted index that measures the performance of the largest capitalization value sector of the U.S. equity market.
The ETF has added about 4.96% so far this year and it's up approximately 19.04% in the last one year (as of 01/29/2025). In the past 52-week period, it has traded between $70.92 and $85.17.
The ETF has a beta of 0.88 and standard deviation of 14.10% for the trailing three-year period, making it a medium risk choice in the space. With about 162 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares Russell Top 200 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, IWX is a good option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $68.17 billion in assets, Vanguard Value ETF has $133.88 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
Bottom-Line
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.
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.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>iShares Russell Top 200 Value ETF (IWX): ETF Research Reports
JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report
Exxon Mobil Corporation (XOM) : Free Stock Analysis Report
Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report
Vanguard Value ETF (VTV): ETF Research Reports
Schwab U.S. Dividend Equity ETF (SCHD): ETF Research Reports
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
