If you're interested in broad exposure to the Large Cap Value segment of the US equity market, look no further than the iShares S&P 500 Value ETF (IVE), a passively managed exchange traded fund launched on 05/22/2000.

The fund is sponsored by Blackrock. It has amassed assets over $35.20 billion, making it one of the largest ETFs attempting to match the Large Cap Value segment of the US equity market.

Why Large Cap Value

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.

Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however 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 1.86%.

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 Financials sector--about 23.30% of the portfolio. Healthcare and Industrials round out the top three.

Looking at individual holdings, Berkshire Hathaway Inc Class B (BRK.B) accounts for about 4.15% of total assets, followed by Jpmorgan Chase & Co (JPM) and Exxon Mobil Corp (XOM).

The top 10 holdings account for about 19.68% of total assets under management.

Performance and Risk

IVE seeks to match the performance of the S&P 500 Value Index before fees and expenses. The S&P 500 Value Index measures the performance of the large capitalization value sector of the U.S. equity market. It is a subset of the S&P 500 and consists of those stocks in the S&P 500 exhibiting the strongest value characteristics.

The ETF has gained about 13.89% so far this year and was up about 29.87% in the last one year (as of 10/08/2024). In the past 52-week period, it has traded between $147.64 and $197.17.

The ETF has a beta of 0.92 and standard deviation of 14.77% for the trailing three-year period, making it a medium risk choice in the space. With about 442 holdings, it effectively diversifies company-specific risk.

Alternatives

IShares S&P 500 Value ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IVE is an excellent option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.

The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $61.71 billion in assets, Vanguard Value ETF has $127.45 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.

Bottom-Line

While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.

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 500 Value ETF (IVE): ETF Research Reports

JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report

Exxon Mobil Corporation (XOM) : Free Stock Analysis Report

Berkshire Hathaway Inc. (BRK.B) : Free Stock Analysis Report

Vanguard Value ETF (VTV): ETF Research Reports

Schwab U.S. Dividend Equity ETF (SCHD): ETF Research Reports

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