Yahoo Finance Should iShares S&P Small-Cap 600 Value ETF (IJS) Be on Your Investing Radar?
Launched on 07/24/2000, the iShares S&P Small-Cap 600 Value ETF (IJS) 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 $6.87 billion, making it one of the largest 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.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their 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
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.18%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.51%.
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 Consumer Discretionary sector--about 19.20% of the portfolio. Industrials and Financials round out the top three.
Looking at individual holdings, Blk Csh Fnd Treasury Sl Agency (XTSLA) accounts for about 3.88% of total assets, followed by Meritage Corp (MTH) and Essential Properties Realty Trust (EPRT).
Performance and Risk
IJS seeks to match the performance of the S&P SmallCap 600 Value Index before fees and expenses. The S&P SmallCap 600 Value Index measures the performance of the small capitalization value sector of the U.S. equity market.
The ETF has gained about 0.82% so far this year and is down about -11.41% in the last one year (as of 03/30/2023). In the past 52-week period, it has traded between $82.45 and $106.56.
The ETF has a beta of 1.19 and standard deviation of 28.31% for the trailing three-year period, making it a medium risk choice in the space. With about 513 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares S&P Small-Cap 600 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, IJS is an outstanding option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell 2000 Value ETF (IWN) and the Vanguard Small-Cap Value ETF (VBR) track a similar index. While iShares Russell 2000 Value ETF has $11.21 billion in assets, Vanguard Small-Cap Value ETF has $23.83 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
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 S&P Small-Cap 600 Value ETF (IJS): ETF Research Reports
Meritage Homes Corporation (MTH) : Free Stock Analysis Report
Vanguard Small-Cap Value ETF (VBR): ETF Research Reports
iShares Russell 2000 Value ETF (IWN): ETF Research Reports
Essential Properties Realty Trust, Inc. (EPRT) : Free Stock Analysis Report
