Should iShares Russell MidCap Value ETF (IWS) Be on Your Investing Radar?

The iShares Russell MidCap Value ETF (IWS) was launched on 07/17/2001, and is a passively managed exchange traded fund designed to offer broad exposure to the Mid Cap Value segment of the US equity market.

The fund is sponsored by Blackrock. It has amassed assets over $15.03 billion, making it one of the largest ETFs attempting to match the Mid Cap Value segment of the US equity market.

Why Mid Cap Value

Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus they have a nice balance of growth potential and stability.

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. 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

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 0.23%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.34%.

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 17.10% of the portfolio. Industrials and Real Estate round out the top three.

Looking at individual holdings, Marvell Technology Inc (MRVL) accounts for about 0.76% of total assets, followed by Ihs Markit Ltd (INFO) and Marathon Petroleum Corp (MPC).

The top 10 holdings account for about 5.82% of total assets under management.

Performance and Risk

IWS seeks to match the performance of the Russell MidCap Value Index before fees and expenses. The Russell Midcap Value Index measures the performance of the mid-capitalization value sector of the U.S. equity market.

The ETF has added about 28.91% so far this year and it's up approximately 34.15% in the last one year (as of 11/19/2021). In the past 52-week period, it has traded between $92.07 and $122.75.

The ETF has a beta of 1.13 and standard deviation of 25.85% for the trailing three-year period, making it a medium risk choice in the space. With about 705 holdings, it effectively diversifies company-specific risk.

Alternatives

IShares Russell MidCap Value ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IWS 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 S&P MidCap 400 Value ETF (IJJ) and the Vanguard MidCap Value ETF (VOE) track a similar index. While iShares S&P MidCap 400 Value ETF has $9.33 billion in assets, Vanguard MidCap Value ETF has $15.57 billion. IJJ has an expense ratio of 0.18% 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 Russell MidCap Value ETF (IWS): ETF Research Reports
 
Marvell Technology, Inc. (MRVL) : Free Stock Analysis Report
 
Marathon Petroleum Corporation (MPC) : Free Stock Analysis Report
 
Vanguard MidCap Value ETF (VOE): ETF Research Reports
 
IHS Markit Ltd. (INFO) : Free Stock Analysis Report
 
iShares S&P MidCap 400 Value ETF (IJJ): ETF Research Reports
 
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