If you're interested in broad exposure to the Mid Cap Growth segment of the US equity market, look no further than the iShares S&P Mid-Cap 400 Growth ETF (IJK), a passively managed exchange traded fund launched on 07/24/2000.
The fund is sponsored by Blackrock. It has amassed assets over $8.01 billion, making it one of the larger ETFs attempting to match the Mid Cap Growth segment of the US equity market.
Why Mid Cap Growth
Mid cap companies, with market capitalization in the range of $2 billion and $10 billion, offer investors many things that small and large companies don't, including less risk and higher growth opportunities. Thus they have a nice balance of growth potential and stability.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. Compared to value stocks, growth stocks are a safer bet in a strong bull market, but don't perform as strongly in almost all other financial environments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.17%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.87%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 26.40% of the portfolio. Consumer Discretionary and Financials round out the top three.
Looking at individual holdings, Interactive Brokers Group Inc Clas (IBKR) accounts for about 1.35% of total assets, followed by Rb Global Inc (RBA) and Emcor Group Inc (EME).
The top 10 holdings account for about 8.53% of total assets under management.
Performance and Risk
IJK seeks to match the performance of the S&P MidCap 400 Growth Index before fees and expenses. The S&P MidCap 400 Growth Index measures the performance of the mid-capitalization growth sector of the U.S. equity market.
The ETF has lost about -12.57% so far this year and is down about -6.17% in the last one year (as of 04/18/2025). In the past 52-week period, it has traded between $73.70 and $99.46.
The ETF has a beta of 1.08 and standard deviation of 21.78% for the trailing three-year period, making it a medium risk choice in the space. With about 246 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares S&P Mid-Cap 400 Growth 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, IJK is an excellent option for investors seeking exposure to the Style Box - Mid Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Mid-Cap Growth ETF (VOT) and the iShares Russell Mid-Cap Growth ETF (IWP) track a similar index. While Vanguard Mid-Cap Growth ETF has $14.26 billion in assets, iShares Russell Mid-Cap Growth ETF has $16.14 billion. VOT has an expense ratio of 0.07% and IWP charges 0.23%.
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 Mid-Cap 400 Growth ETF (IJK): ETF Research Reports Interactive Brokers Group, Inc. (IBKR): Free Stock Analysis Report EMCOR Group, Inc. (EME): Free Stock Analysis Report RB Global, Inc. (RBA): Free Stock Analysis Report iShares Russell Mid-Cap Growth ETF (IWP): ETF Research Reports Vanguard Mid-Cap Growth ETF (VOT): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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