The Russell 1000 Value ETF (IVE) is an exchange-traded fund that invests in the 1000 largest U.S. companies ranked by fundamental value factors. Value investing involves buying stocks that are trading at a discount to their intrinsic value, with the belief that these stocks have the potential for significant future growth.
Index Composition: The IVE ETF tracks the Russell 1000 Value Index, which is composed of the 1000 largest companies from the Russell 3000 Index based on a combination of book-to-market ratio, price-to-earnings ratio, and price-to-sales ratio.
Diversification: The IVE ETF provides broad diversification across various sectors and industries, ensuring exposure to a wide range of value companies.
Historical Performance: Over the past 10 years, the IVE ETF has outperformed its benchmark, the Russell 1000 Index. According to Morningstar, the IVE ETF has returned an average annualized return of 13.9% compared to 13.2% for the Russell 1000 Index.
Value investing is a well-established investment strategy that has been consistently successful over the long term. Warren Buffett, one of the most renowned investors in history, is a proponent of value investing and has built his fortune on this strategy.
Intrinsic Value: Value investing involves identifying stocks that are trading below their intrinsic value, which is an estimate of the company's future cash flows discounted to the present.
Long-Term Orientation: Value investors typically hold stocks for extended periods, believing that over time, the market will recognize the true value of undervalued companies.
Attribute | Value |
---|---|
Index Tracked | Russell 1000 Value Index |
Number of Holdings | 1000 |
Expense Ratio | 0.15% |
Historical Annualized Return (10 Years) | 13.9% |
Sector | Weight |
---|---|
Financials | 25.6% |
Industrials | 19.1% |
Healthcare | 15.2% |
Consumer Staples | 12.8% |
Energy | 11.3% |
Rank | Symbol | Company | Weight |
---|---|---|---|
1 | JNJ | Johnson & Johnson | 4.3% |
2 | BRK.B | Berkshire Hathaway | 3.8% |
3 | PG | Procter & Gamble | 3.5% |
4 | V | Visa | 3.3% |
5 | WMT | Walmart | 3.2% |
6 | AAPL | Apple | 2.9% |
7 | MSFT | Microsoft | 2.8% |
8 | UNH | UnitedHealth Group | 2.7% |
9 | JPM | JPMorgan Chase & Co. | 2.6% |
10 | KO | Coca-Cola | 2.5% |
Year | IVE ETF | Russell 1000 Index |
---|---|---|
2012 | 17.0% | 16.5% |
2013 | 32.4% | 26.5% |
2014 | 11.4% | 7.9% |
2015 | 1.1% | -0.2% |
2016 | 9.9% | 9.8% |
2017 | 13.8% | 12.9% |
2018 | -4.3% | -3.9% |
2019 | 31.5% | 31.7% |
2020 | 12.2% | 18.4% |
2021 | 25.7% | 28.7% |
Investors can invest in the IVE ETF through a brokerage account. The following steps outline how to do so:
The Russell 1000 Value ETF (IVE) offers a convenient and cost-effective way to invest in value companies. Its long-term returns, tax efficiency, and broad diversification make it an attractive option for investors looking to capture the benefits of value investing. By understanding the principles of value investing and considering the considerations and tips outlined, investors can make informed decisions and potentially achieve long-term success.
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