If you're interested in broad exposure to the Small Cap Growth segment of the US equity market, look no further than the iShares S&P Small-Cap 600 Growth ETF (IJT), a passively managed exchange traded fund launched on July 24, 2000.
The fund is sponsored by Blackrock. It has amassed assets over $6.75 billion, making it one of the largest ETFs attempting to match the Small Cap Growth segment of the US equity market.
Why Small Cap Growth
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
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. Something to keep in mind is the higher level of volatility that is affiliated with growth stocks. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.18%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.85%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector -- about 21.2% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Interdigital Inc (IDCC) accounts for about 1.2% of total assets, followed by Moog Inc Class A (MOGA) and Sitime Corp (SITM).
Performance and Risk
IJT seeks to match the performance of the S&P SmallCap 600 Growth Index before fees and expenses. The S&P SmallCap 600 Growth Index measures the performance of the small-capitalization growth sector of the U.S. equity market.
The ETF return is roughly 6.84% so far this year and was up about 14.03% in the last one year (as of 02/24/2026). In the past 52-week period, it has traded between $108.87 and $153.32.
The ETF has a beta of 1.06 and standard deviation of 19.8% for the trailing three-year period, making it a medium risk choice in the space. With about 360 holdings, it effectively diversifies company-specific risk.
Alternatives
iShares S&P Small-Cap 600 Growth ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, IJT is a sufficient option for those seeking exposure to the Style Box - Small Cap Growth area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Growth ETF (IWO) and the Vanguard Small-Cap Growth ETF (VBK) track a similar index. While iShares Russell 2000 Growth ETF has $13.13 billion in assets, Vanguard Small-Cap Growth ETF has $20.97 billion. IWO has an expense ratio of 0.24% and VBK charges 0.05%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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 Small-Cap 600 Growth ETF (IJT): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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