Designed to provide broad exposure to the Large Cap Blend segment of the US equity market, the iShares Core S&P 500 ETF (IVV) is a passively managed exchange traded fund launched on 05/15/2000.
The fund is sponsored by Blackrock. It has amassed assets over $292.65 billion, making it the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies typically have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.
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 0.03%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.50%.
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 Information Technology sector–about 27.90% of the portfolio. Healthcare and Financials round out the top three.
Looking at individual holdings, Apple Inc (AAPL) accounts for about 6.95% of total assets, followed by Microsoft Corp (MSFT) and Amazon Com Inc (AMZN).
The top 10 holdings account for about 27.86% of total assets under management.
Performance and Risk
IVV seeks to match the performance of the S&P 500 Index before fees and expenses. The S&P 500 Index measures the performance of the large-capitalization sector of the U.S. equity market.
The ETF has lost about -16.74% so far this year and is down about -6.99% in the last one year (as of 07/21/2022). In the past 52-week period, it has traded between $366.99 and $479.84.
The ETF has a beta of 1 and standard deviation of 24.26% for the trailing three-year period, making it a medium risk choice in the space. With about 509 holdings, it effectively diversifies company-specific risk.
IShares Core S&P 500 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, IVV is a good option for those seeking exposure to the Style Box – Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The Vanguard S&P 500 ETF (VOO) and the SPDR S&P 500 ETF (SPY) track the same index. While Vanguard S&P 500 ETF has $249.24 billion in assets, SPDR S&P 500 ETF has $357.77 billion. VOO has an expense ratio of 0.03% and SPY charges 0.09%.
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 Core S&P 500 ETF (IVV): ETF Research Reports
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
Microsoft Corporation (MSFT) : Free Stock Analysis Report
SPDR S&P 500 ETF (SPY): ETF Research Reports
Vanguard S&P 500 ETF (VOO): ETF Research Reports
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