The iShares S&P Mid-Cap 400 Value ETF (IJJ) and the iShares Russell 2000 Value ETF (IWN) present two distinct avenues for investors targeting value stocks outside the large-cap tech space. While IJJ focuses on mid-cap companies with a 0.18% expense ratio and a 1.77% dividend yield, IWN offers broader exposure to small-cap stocks with a slightly lower yield of 1.63%. Both funds have demonstrated strong annualized returns since their inception in 2000, with IJJ leading at 10.3% compared to IWN’s 9.3%.
The performance difference can be attributed to the underlying holdings; IJJ’s stocks are predominantly profitable, while IWN includes a significant portion of unprofitable companies. This distinction suggests that IJJ may offer a more stable investment profile, appealing to those wary of volatility.
For portfolio managers and analysts, the choice between IJJ and IWN may hinge on risk tolerance and growth expectations, with IJJ potentially providing a more reliable growth trajectory amid market fluctuations.
Source: fool.com