iShares MSCI Intl Small-Cap Multifactor ETF (ISCF)

Overview

The iShares MSCI Intl Small-Cap Multifactor ETF (ISCF) aims to provide exposure to international small-cap stocks exhibiting characteristics of value, quality, momentum, and low size. The fund focuses on diversifying investments across developed markets, excluding the US and Canada, offering a multifactor approach to enhance returns.

Reputation and Reliability

BlackRock, the issuer, is a well-established and reputable asset management firm with a long track record of managing ETFs.

Management Expertise

BlackRock has a team of experienced investment professionals managing various ETFs, including factor-based strategies.

Goal

The primary investment goal is to provide long-term capital appreciation by investing in a diversified portfolio of international small-cap stocks exhibiting value, quality, momentum, and low size characteristics.

Investment Approach and Strategy

Strategy: The ETF employs a multifactor investment strategy by selecting and weighting stocks based on exposure to value, quality, momentum, and size factors.

Composition The ETF primarily holds stocks of international small-cap companies located in developed markets, excluding the US and Canada.

Market Share: ISCF's market share is niche within the small-cap international ETF sector.

Total Net Assets (AUM): 168953392

Key Competitors

• VSS
• GWX
• SCZ

Competitive Landscape

The international small-cap ETF market is competitive with several established players. ISCF's multifactor approach aims to offer potentially enhanced returns compared to broad market ETFs, but it might be more complex and carry higher expense ratios than standard market cap-weighted ETFs. ISCF differentiates itself through factor selection, offering a blend of value, quality, momentum and low size characteristics which might lead to varied returns.

Historical Performance: Historical performance varies with market conditions and factor performance. Investors should review past performance data to understand its track record.

Benchmark Comparison: The ETF's performance should be compared to the MSCI EAFE Small Cap Index to assess its effectiveness in tracking the target market and factors.

Expense Ratio: 0.3

Average Trading Volume

The average trading volume indicates the ease with which shares can be bought or sold without significantly impacting the price, and ISCF typically displays moderate volume.

Bid-Ask Spread

The bid-ask spread represents the difference between the highest price a buyer is willing to pay and the lowest price a seller is willing to accept, a narrower spread signifies high liquidity.

Market Environment Factors

Economic indicators, geopolitical events, and currency fluctuations in international markets impact ISCF. Sector growth prospects and interest rate policies in various regions also play significant roles.

Growth Trajectory

Growth depends on the overall performance of international small-cap markets and the effectiveness of the multifactor investment strategy. The ETF's holdings can be adjusted based on changing market dynamics and factor performance.

Competitive Edge

ISCF's competitive advantage lies in its multifactor investment strategy, which aims to provide potentially higher returns than standard market-cap-weighted ETFs. The ETF combines value, quality, momentum, and size factors to select and weight stocks. This factor-based approach differentiates it from competitors that only track a single factor or broad market index. BlackRock's established reputation and experience managing factor-based ETFs provide further advantages. However, this complexity translates to a slightly higher expense ratio.

Volatility

Small-cap stocks and international markets can be more volatile than large-cap domestic stocks, contributing to ISCF's potential for higher volatility.

Market Risk

The ETF is exposed to market risk associated with international equity investments, including currency risk, political risk, and economic risks specific to each country.

Ideal Investor Profile

The ideal investor profile includes those seeking international small-cap equity exposure with a preference for factor-based strategies. Investors should be willing to accept potentially higher volatility and understand the risks associated with international investments.

Market Risk

The ETF is suitable for long-term investors seeking diversification and potential outperformance through factor investing, but it is less suitable for short-term traders due to its multifactor complexity and potential volatility.

The iShares MSCI Intl Small-Cap Multifactor ETF (ISCF) offers exposure to international small-cap stocks using a multifactor approach, targeting value, quality, momentum, and low size. It's managed by BlackRock, a reputable issuer, and seeks long-term capital appreciation. While it aims for enhanced returns, it comes with a slightly higher expense ratio and exposure to international market risks. This ETF is best suited for long-term investors who understand the multifactor investing strategy and are willing to accept potential volatility for potential outperformance.

Data Sources:

• iShares Website
• Morningstar
• ETF.com

Disclaimers:

Data is based on available information and may be subject to change. Investment decisions should be based on individual circumstances and after consulting with a financial advisor. Market share data are approximations.