6 min readBy Ron Koren ETF Insider
How does the IMCV ETF work?
The IMCV ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
BlackRock, as the issuer of the IMCV ETF, plays a crucial role in offering investors targeted exposure to the U.S. mid-capitalization stock market, with a specific focus on value oriented stocks. The IMCV ETF, managed by BlackRock, is strategically designed to emulate the performance of the Morningstar® US Mid Cap Broad Value IndexSM. This index predominantly includes stocks of U.S. mid-cap companies that are identified for their relatively low market valuations. These valuations are meticulously determined using various financial metrics such as price-to-earnings and price-to-book value ratios.
Although the primary objective of the iShares Morningstar Mid-Cap Value ETF (IMCV) is to track the Morningstar® US Mid Cap Broad Value IndexSM, its dividend distribution aligns with the underlying index's characteristics. Dividends from IMCV typically occur periodically and are contingent upon the dividend policies and performances of the mid-cap value companies within the index. Given that the underlying index consists of stocks with favorable valuation metrics, investors can anticipate a balance of capital appreciation potential along with dividend income from this ETF.
Tracking the Morningstar® US Mid Cap Broad Value IndexSM is the primary objective of the IMCV ETF. This ETF aims to mirror the performance of U.S. stocks issued by mid-capitalization companies displaying value characteristics, as defined by Morningstar, Inc. These mid-cap stocks typically fall within the 70th to 90th percentile of the market capitalization range. The Index Provider categorizes the stocks in the Underlying Index as value based on factors like price-to-earnings, price-to-book value, price-to-sales, price-to-cash flow, and dividend yields. IMCV utilizes a representative sampling indexing strategy and invests at least 80% of its assets in the component securities of its Underlying Index to achieve its investment objective. This ETF provides investors with exposure to value-oriented mid-cap U.S. equities.
The correlation aspect of the iShares Morningstar Mid-Cap Value ETF (IMCV) primarily reflects its tracking of the Morningstar US Mid Cap Broad Value Index. As this ETF aims to capture the performance of mid-cap U.S. companies exhibiting value characteristics, its correlation with the mid-cap value segment of the equity market is expected to be quite strong. Investors looking to diversify their portfolios with mid-cap value stocks often assess IMCV's correlation with other assets to gain insights into the performance of this specific market segment. To study and visualize these correlations effectively, you can utilize our tool, ETF Insider, which provides comprehensive data and insights for all U.S. ETFs, helping you make informed investment decisions and identify potential overlaps in your portfolio.
The iShares Morningstar Mid-Cap Value ETF (IMCV) is primarily invested in mid-capitalization companies that exhibit value characteristics according to Morningstar's assessment. This sector is characterized by holdings in companies with relatively low valuations based on various financial metrics like price-to-earnings, price-to-book value, price-to-sales, price-to-cash flow, and dividend yields. As of April 30, 2023, a significant portion of the underlying index represents securities from the financial services industry. The ETF aims to provide investors with exposure to mid-cap value stocks, potentially offering opportunities for value-driven investment strategies while maintaining a diversified portfolio.
The iShares Morningstar Mid-Cap Value ETF (IMCV) is designed to provide exposure to U.S. mid-capitalization companies with value characteristics. This ETF tracks the Morningstar® US Mid Cap Broad Value IndexSM, which selects stocks falling between the 70th and 90th percentile of market capitalization based on their value-oriented attributes. IMCV primarily invests in securities representing industries that demonstrate these value characteristics, and as of April 30, 2023, it had a significant allocation to the financial services sector. For investors seeking targeted exposure to mid-cap value stocks in the U.S., IMCV offers a passive investment approach.
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