What does IWM track?
4 min read
By Ron Koren, ETF Insider

What does IWM track?

When it comes to investing in exchange-traded funds (ETFs), understanding what an ETF tracks is essential for making informed investment decisions. The IWM ETF, also known as the iShares Russell 2000 ETF, is a popular choice among investors. But what exactly does the IWM track? In this article, we will explore the underlying index that the IWM ETF follows and shed light on the composition and characteristics of this ETF. By understanding what the IWM tracks, investors can gain insights into the types of stocks and market segments they will be exposed to, helping them evaluate its potential fit within their investment strategies.

IWM overview

The ETF with the ticker symbol IWM refers to the iShares Russell 2000 ETF. This ETF is designed to track the performance of the Russell 2000 Index, which represents the small-cap segment of the U.S. equity market. It aims to provide investors with exposure to a broad range of small-cap stocks. The iShares Russell 2000 ETF is one of the popular exchange-traded funds available for investors looking to diversify their portfolios with small-cap stocks.

IWM: Benefits and Risks of Investing in Small-Cap Stocks

Investing in small-cap stocks, such as those tracked by IWM, can offer several advantages. Small-cap stocks have the potential for high growth, as they are often in the early stages of their development. They can also provide diversification benefits to a portfolio, as they tend to have lower correlations with larger-cap stocks. However, it's important to note that small-cap stocks can be more volatile and carry higher risks compared to larger, more established companies.

IWM overlap What does IWM track?IWM overlap What does IWM track?

IWM: Understanding the Russell 2000 Index

The Russell 2000 Index, which IWM seeks to track, is a benchmark index that measures the performance of approximately 2,000 small-cap companies in the United States. These companies are selected based on specific criteria, including their market capitalization and liquidity. The index provides a comprehensive view of the small-cap segment and is widely used by investors and financial professionals to gauge the performance of small-cap stocks.

IWM: How to Incorporate the ETF in Your Investment Strategy

Including IWM in your investment strategy requires careful consideration of your financial goals, risk tolerance, and investment time horizon. It's essential to conduct thorough research on the fund, assess its historical performance, expense ratios, and holdings. Investors may also consider consulting with a financial advisor who can provide personalized guidance based on their individual circumstances and investment objectives.

In summary, the iShares Russell 2000 ETF (IWM) is designed to track the performance of the Russell 2000 Index, providing investors exposure to small-cap stocks. Investing in IWM can offer diversification benefits and the potential for high growth but comes with higher risks associated with small-cap stocks. Understanding the underlying index and conducting thorough research are important before incorporating IWM into an investment strategy.

Disclaimer: This article is for informational purposes only and does not provide investment advisory services.

Source 1: IWM issuer website
Source 2: Reuters article about IWM

IWM quote and analysis

Discover the top holdings, correlations, and overlaps of ETFs using our visualization tool.
Our app allows you to build and track your portfolio.
To learn more about the IWM iShares Russell 2000 ETF, access our dedicated page now.

Get started


  • What is IWM?

    IWM is the ticker symbol for the iShares Russell 2000 ETF. It represents an exchange-traded fund that aims to track the performance of the Russell 2000 Index, which consists of small-cap stocks in the U.S. equity market.

  • What does IWM stand for in stocks?

    IWM stands for "iShares Russell 2000." It is a commonly used ticker symbol to represent the iShares Russell 2000 ETF in stock market trading.

  • What does IWM track?

    IWM tracks the performance of the Russell 2000 Index. This index is designed to measure the performance of the small-cap segment of the U.S. equity market. It includes approximately 2,000 small-cap stocks.

  • What is the IWM index?

    The IWM index refers to the Russell 2000 Index. It is widely recognized as a benchmark for measuring the performance of small-cap stocks in the U.S. equity market.

  • What stocks are in the IWM?

    The IWM ETF holds a diversified portfolio of stocks that aims to replicate the performance of the Russell 2000 Index. The specific stocks held in the IWM can change over time as the fund's holdings are periodically adjusted to align with the index. The Russell 2000 Index includes a broad range of small-cap stocks from various sectors.