Top Performing ETFs Currently Wager on These Strategies
Take a Gander at These Value-Packed ETFs
In the midst of the past year, Value-ETFs orchestrated a triumphant performance over ETFs tracking the MSCI World Index, leaving many wondering, "What's the secret sauce in these Value-ETFs?" Let's delve into three intriguingValue-ETFs that are breaking records.
The Big Kahuna
With a whopping €3.8 billion Assets Under Management (AUM), the iShares Edge MSCI World Value Factor ETF reins supreme as the largestglobal equity Value-ETF in Germany.
The iShares Value-ETF tailspins after the MSCI World Enhanced Value Index and switches up a portfolio of 400 individual stocks. Top picks include Intel, Pfizer, and Shell, which take a backseat in the iShares Core MSCI World ETF.
The Green Giant
This time, environmentalists and investors can partner up with the iShares MSCI World Value Factor ESG ETF (WKN: A3CUJR), a sustainable Value-ETF boasting AUM of €530 million. This iShares ESG-focused Value-ETF aligns with the MSCI World Value ESG Reduced Carbon Target Select Index and lays down the cash on 224 individual stocks. Its top two holdings? You've guessed it - Microsoft and Apple, shuffling around in the limelight in the iShares Core MSCI World ETF, but with a slight twist. The tech sector (24.9%) sends in the heaviest artillery, followed by financials (17.8%). The majority of stocks hail from the US (61.4%) and Japan (11.7%).
The Dark Horse
Ever since December 2007, investors have been entranced by the Invesco FTSE RAFI All World 3000 ETF. Although the name fails to hint at its Value strategy, the Invesco ETF has amassed AUM of only €39 million. The Invesco ETF follows suit of the FTSE RAFI All-World 3000 Index, spreading its betting chips globally among 3000 stocks, including Chinese stocks, which the iShares ETFs cannot boast. The selection process for the Invesco ETF is distinctive, emphasizing four fundamental criteria - book value, cash flow, dividend payments, and sales. Top hitters like Exxon Mobil, Berkshire Hathaway, Shell, Chevron, and JPMorgan Chase own the top spots. The financial sector (21.7%) and industrials (11.0%) gain center stage, while US stocks (51.8%) and Japanese stocks (8.2%) set the vibe.
Curiosity piqued? What would a well-rounded MSCI World Index yield?
Disclaimer: The author maintains direct positions in the financial instruments mentioned in the publication or related derivatives that could profit from the possible price fluctuations instigated by the publication: Pfizer, Apple, ExxonMobil, Berkshire Hathaway
The Lowdown on the MSCI World Index
The MSCI World Index commands a dominion over large and mid-cap stocks across 23 developed markets. Although it doesn't explicitly sport a "balanced" version, it serves as the foundation for several style and factor indexes. Let's bust out some facts about its composition and related indexes:
The Elemental Breakdown of the MSCI World Index
- Number of Constituents: Approximately 1,352 stocks.
- Country Weights: The US shines brightest, with other major developed markets like Switzerland, the UK, and Japan not far behind.[2]
- Sector Exposure: The sector allocation isn't laid out explicitly in the search results, but common sectors usually range from Information Technology, Consumer Staples, Healthcare, and more.
Indexes That Embody Diversification
MSCI World Growth Index
- Knows stocks with growth characteristics.
- Covers large and mid-cap securities across 23 developed markets.[1]
MSCI World Quality Index
- Honors high-quality stocks marked by profitability, leverage, and earnings stability.
- Dons a distinct sector and stock composition compared to the parent index.[2]
MSCI World Diversified Multiple-Factor Index
- Integrates various factors such as value, size, momentum, yield, and quality for a diversified portfolio.
- While rooted in the MSCI World Index, it sports a distinct composition with 475 constituents.[5]
To build a balanced investment strategy via the MSCI World Index, investors might consider melding components from these related indexes, such as growth, quality, and multiple factors, for a well-rounded approach.
- The iShares Edge MSCI World Value Factor ETF, despite its large AUM, differs from the iShares Core MSCI World ETF by including companies like Intel, Pfizer, and Shell, which have a smaller presence in the latter.
- The iShares MSCI World Value Factor ESG ETF, with a focus on sustainability, stands out by investing in tech giants Microsoft and Apple, while these companies hold minor positions in the iShares Core MSCI World ETF.
- The Invesco FTSE RAFI All World 3000 ETF, while emphasizing a Value strategy, comprises top companies like Exxon Mobil, Berkshire Hathaway, Shell, Chevron, and JPMorgan Chase, which are not major holdings in iShares ETFs.
- A well-rounded MSCI World Index might offer a more balanced investment approach by incorporating components from related indexes such as growth, quality, and multiple factors, but the specific sector allocation is not explicitly provided in the search results.
