Should iShares Russell 1000 ETF (IWB) Be on Your Investing Radar?

Launched on 05/15/2000, the iShares Russell 1000 ETF (IWB) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Blend segment of the US equity market.

The fund is sponsored by Blackrock. It has amassed assets over $40.09 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.

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 0.15%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 1.12%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector--about 30.50% of the portfolio. Financials and Consumer Discretionary round out the top three.

Looking at individual holdings, Microsoft Corp (MSFT) accounts for about 6.24% of total assets, followed by Apple Inc (AAPL) and Nvidia Corp (NVDA).

The top 10 holdings account for about 31.41% of total assets under management.

Performance and Risk

IWB seeks to match the performance of the Russell 1000 Index before fees and expenses. The Russell 1000 Index measures the performance of the large-capitalization sector of the U.S. equity market. The Index is a float-adjusted capitalization-weighted index of equity securities issued by the approximately 1,000 largest issuers in the Russell 3000 Index.

The ETF has added about 1.37% so far this year and is up roughly 13.07% in the last one year (as of 05/21/2025). In the past 52-week period, it has traded between $272.36 and $337.54.

The ETF has a beta of 1.01 and standard deviation of 17.94% for the trailing three-year period, making it a medium risk choice in the space. With about 1011 holdings, it effectively diversifies company-specific risk.

Alternatives

IShares Russell 1000 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, IWB is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.

The SPDR S&P 500 ETF (SPY) and the Vanguard S&P 500 ETF (VOO) track a similar index. While SPDR S&P 500 ETF has $603.42 billion in assets, Vanguard S&P 500 ETF has $648.09 billion. SPY has an expense ratio of 0.09% and VOO charges 0.03%.

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

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