Is iShares MSCI ACWI Low Carbon Target ETF (CRBN) a Strong ETF Right Now?

Launched on 12/08/2014, the iShares MSCI ACWI Low Carbon Target ETF (CRBN) is a smart beta exchange traded fund offering broad exposure to the World ETFs category of the market.

What Are Smart Beta ETFs?

Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.

Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.

If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.

This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.

While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.

Fund Sponsor & Index

The fund is sponsored by Blackrock. It has amassed assets over $1.03 billion, making it one of the larger ETFs in the World ETFs. CRBN seeks to match the performance of the MSCI ACWI Low Carbon Target Index before fees and expenses.

The MSCI ACWI Low Carbon Target Index is designed to address two dimensions of carbon exposure ? carbon emissions and potential carbon emissions from fossil fuel reserves.

Cost & Other Expenses

Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.

Annual operating expenses for CRBN are 0.20%, which makes it one of the least expensive products in the space.

It's 12-month trailing dividend yield comes in at 1.86%.

Sector Exposure and Top Holdings

Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.

When you look at individual holdings, Nvidia Corp (NVDA) accounts for about 4.68% of the fund's total assets, followed by Microsoft Corp (MSFT) and Apple Inc (AAPL).

CRBN's top 10 holdings account for about 23.1% of its total assets under management.

Performance and Risk

The ETF return is roughly 11.36% and was up about 20.97% so far this year and in the past one year (as of 08/05/2025), respectively. CRBN has traded between $170.20 and $216.72 during this last 52-week period.

The fund has a beta of 0.94 and standard deviation of 15.70% for the trailing three-year period, which makes CRBN a low risk choice in this particular space. With about 1020 holdings, it effectively diversifies company-specific risk .

Alternatives

iShares MSCI ACWI Low Carbon Target ETF is a reasonable option for investors seeking to outperform the World ETFs segment of the market. However, there are other ETFs in the space which investors could consider.

Vanguard ESG U.S. Stock ETF (ESGV) tracks FTSE US ALL CAP CHOICE INDEX and the iShares ESG Aware MSCI USA ETF (ESGU) tracks MSCI USA ESG Focus Index. Vanguard ESG U.S. Stock ETF has $10.85 billion in assets, iShares ESG Aware MSCI USA ETF has $13.98 billion. ESGV has an expense ratio of 0.09% and ESGU changes 0.15%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the World ETFs

Bottom Line

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This article originally published on Zacks Investment Research (zacks.com).

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