iShares Morningstar Mid-Cap Value ETF (JKI)

Overview

The iShares Morningstar Mid-Cap Value ETF (IWS) seeks to track the investment results of the Morningstar Mid Value Index, which measures the performance of mid-capitalization U.S. companies exhibiting value characteristics. It focuses on companies with lower valuations relative to their fundamentals.

Reputation and Reliability

iShares is a well-established ETF provider with a strong reputation for reliability and a wide range of investment options.

Management Expertise

BlackRock, the issuer of iShares ETFs, has extensive experience and expertise in managing investment portfolios and tracking various market indices.

Goal

The investment seeks to track the investment results of the Morningstar Mid Value Index.

Investment Approach and Strategy

Strategy: The ETF tracks the Morningstar Mid Value Index, a benchmark of mid-cap U.S. stocks with value characteristics.

Composition The ETF primarily holds stocks of mid-sized companies in the U.S. that are considered undervalued based on factors like price-to-earnings, price-to-book, and price-to-cash flow ratios.

Market Share: IWS has a significant market share within the mid-cap value ETF category.

Total Net Assets (AUM): 1450000000

Key Competitors

• Vanguard Mid-Cap Value ETF (VOE)
• Schwab Fundamental U.S. Mid-Cap ETF (FNDX)
• SPDR S&P MidCap 400 Value ETF (MDYV)

Competitive Landscape

The mid-cap value ETF market is competitive with multiple established players. IWS benefits from the strong iShares brand, but VOE, due to its lower expense ratio and large AUM, often attracts more investor capital. FNDX uses a fundamental weighting strategy which differentiates it from the market cap weighted approach of IWS, possibly attracting investors seeking an alternative approach. MDYV tracks a different index with more stringent value metrics.

Historical Performance: The historical financial performance data needs to be gathered from the web, depending on the availability.

Benchmark Comparison: IWS aims to track the Morningstar Mid Value Index, so its performance should closely mirror the index's returns.

Expense Ratio: 0.23

Average Trading Volume

The ETF's liquidity is reasonable, averaging around 100,000 shares traded daily, providing sufficient ease of entry and exit for most investors.

Bid-Ask Spread

The typical bid-ask spread of a few cents indicates relatively low transaction costs for trading IWS.

Market Environment Factors

Economic conditions, interest rates, and overall market sentiment can influence the performance of mid-cap value stocks, impacting IWS.

Growth Trajectory

IWS's growth trajectory depends on the demand for value investing and the overall performance of mid-cap companies. There aren't significant changes to strategy or holdings beyond index reconstitutions.

Competitive Edge

IWS benefits from the strong iShares brand and wide distribution network. It also tracks a well-known value index from Morningstar, which lends credibility. However, its expense ratio is slightly higher than some competitors, which could be a disadvantage. Its primary advantage is the brand recognition of iShares and the Morningstar methodology, providing investor confidence.

Volatility

Mid-cap stocks can exhibit higher volatility than large-cap stocks, and value stocks may underperform during growth-oriented market cycles.

Market Risk

The ETF is subject to market risk, meaning its value can fluctuate based on overall market conditions and the performance of its underlying holdings. Specific risks include economic downturns or negative news affecting the sectors in which its holdings operate.

Ideal Investor Profile

IWS is suitable for investors seeking exposure to mid-cap value stocks as part of a diversified portfolio. Ideal investors are looking to capture potential long-term capital appreciation through value investing.

Market Risk

IWS is best for long-term investors who understand the potential for short-term volatility and are comfortable with a value-oriented investment strategy.

IWS provides targeted exposure to mid-cap value stocks in the U.S., tracking the Morningstar Mid Value Index. It offers a straightforward way to implement a value investing strategy within the mid-cap space. However, investors should consider its expense ratio relative to competitors like VOE. Overall, IWS is a solid option for long-term investors seeking value exposure and a diversified portfolio.

Data Sources:

• iShares website
• Morningstar
• ETF.com
• Seeking Alpha

Disclaimers:

The information provided is for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Market share data is approximate and based on available information at the time of analysis.