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Looking for broad exposure to the Financials - Broad segment of the equity market? You should consider the iShares U.S. Financials ETF (IYF), a passively managed exchange traded fund launched on 05/22/2000.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Financials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 1, placing it in top 6%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $3.97 billion, making it one of the largest ETFs attempting to match the performance of the Financials - Broad segment of the equity market. IYF seeks to match the performance of the Dow Jones U.S. Financials Index before fees and expenses.
The Russell 1000 Financials 40 Act 15/22.5 Daily Capped Index measures the performance of the financial sector of the U.S. equity market.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.39%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.20%.
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 in the Financials sector--about 99.50% of the portfolio.
Looking at individual holdings, Berkshire Hathaway Inc Class B (BRK.B) accounts for about 12.50% of total assets, followed by Jpmorgan Chase & Co (JPM) and Bank Of America Corp (BAC).
The top 10 holdings account for about 46.79% of total assets under management.
Performance and Risk
So far this year, IYF has added about 7.32%, and it's up approximately 37.21% in the last one year (as of 02/10/2025). During this past 52-week period, the fund has traded between $86.94 and $119.20.
The ETF has a beta of 1.07 and standard deviation of 19.31% for the trailing three-year period, making it a medium risk choice in the space. With about 142 holdings, it effectively diversifies company-specific risk.