This content is from: Innovation

The Benefits of Using an Index-Based ETF for U.S. Large-Caps

For institutional investors seeking to add long-term growth potential to a portfolio, the iShares Russell 1000 ETF (IWB) offers diversified exposure to large U.S. companies.

Among sophisticated investors, there are several portfolio strategies that require the ballast and stability of U.S. large-cap stocks – or the securities for U.S. based corporations that have a market capitalization of at least $10 billion. Relative to other categories of securities, the stocks of America’s massive, publicly-traded companies – and its largest public mid-cap corporations with market capitalizations generally over $5 billion – can provide an increased stability to a portfolio that’s often desired by investors.

These large, established companies are typically better positioned to survive economic downturns than smaller entities, of course, and their role as veritable I-beams in the U.S. economy can even help them weather severe situations; many influential parties in the financial system may have a shared interest in keeping these titans open for business through crises.

IWB: An ETF for investors seeking long-term growth

Institutional investors can add diversified exposure to U.S. large-cap companies, and the bigger mid-cap companies just under them in size,with the iShares Russell 1000 ETF (IWB). IWB seeks to track a long- index of U.S. large and mid-caps: the Russell 1000 Index.

 Formed in 1984, the Russell 1000 Index is comprised of the 1,000 largest publicly traded companies in the U.S. These 1,000 companies have market capitalizations of about $2 billion to $12+ billion. The 200 largest companies in the index (with market caps over $10 billion) are large-caps, while the remaining 800 companies have market caps of $2 billion to $10 billion and therefore fall into the mid-cap category. Given the representation of America’s largest corporations, the Russell 1000 Index is commonly regarded as a benchmark for the overall performance of U.S. large-cap stocks.

IWB can be used as a tool to tilt institutional portfolios toward long-term growth while gaining the trading advantages and diversification that ETFs offer over both mutual funds and owning individual stocks. Since its creation in May 2000, investors of all sizes have used IWB as a foundational building block of securities in their portfolio.

IWB is one of three iShares ETFs that seek to track a Russell index with large-cap U.S. stocks. The other two are the iShares Russell 1000 Value ETF (IWD) and the iShares Russell 1000 Growth ETF (IWF). The value focused product, IWD, seeks exposure to large-cap and mid-cap U.S. companies that are thought to be undervalued, so its inclusion in a portfolio could assist a tilt toward value stocks. The growth option, IWF, focuses on large and mid-cap stocks that are expected to grow at above-average rates relative to the market and can be used to lean a portfolio toward growth.

IWB spreads its top five sector exposures across Information Technology, Healthcare, Consumer Discretionary, Financials, and Communication (see table below).

As of October 27, 2021, IWB had net assets of $31,473,937,609 and a 30-day average volume of $644,403.00 with 1,027 holdings.

See the charts below for more details about the iShares Russell 1000 ETF (IWB). You can find more info on this ETF here.

iShares
There is no guarantee that securities lending will generate any level of income. Distributions paid out of the Fund’s net investment income, including income from securities lending, if any, are taxable to investors as ordinary income. There is no guarantee that there will be borrower demand for shares of ETFs, or that securities lending will generate any level of income. ETF share lending revenue is not an element of fund performance and share lending is not a service provided by iShares or BlackRock ETFs or BlackRock Fund Advisors, the funds' investment manager and an affiliate of BlackRock Investments LLC.

This material represents an assessment of the market environment as of the date indicated; is subject to change; and is not intended to be a forecast of future events or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding the funds or any issuer or security in particular. The strategies discussed are strictly for illustrative and educational purposes and are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. There is no guarantee that any strategies discussed will be effective.

Funds that concentrate investments in specific industries, sectors, markets or asset classes may underperform or be more volatile than other industries, sectors, markets or asset classes and the general securities market. Diversification and asset allocation may not protect against market risk or loss of principal.There is no guarantee that any fund will pay dividends.

Past performance does not guarantee future results. For iShares ETF performance, please visit www.iShares.com or www.blackrock.com. The iShares Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).

The iShares Funds are not sponsored, endorsed, issued, sold or promoted by Russell, nor does this company make any representation regarding the advisability of investing in the Funds. BlackRock is not affiliated with Russell.

©2021 BlackRock, Inc. All rights reserved. iSHARES and BLACKROCK are trademarks of BlackRock, Inc., or its subsidiaries in the United States and elsewhere. All other marks are the property of their respective owners.

FOR INSTITUTIONAL USE ONLY – NOT FOR PUBLIC DISTRIBUTION

iCRMH1121U/S-1879556-1/3  

Related Content