A sound investment process and strong management team underpin iShares US Financial Services ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The strategy's investment process inspires confidence and earns a High Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an underweight position in liquidity exposure and an overweight in quality exposure compared with category peers. Low liquidity risk exposure is attributed to stocks with a low trading volume, limiting managers' flexibility. And a high quality exposure is rooted in holding stocks with low financial leverage and strong returns on equity. The strategy’s management team earns an Above Average People Pillar rating. The strategy's parent organization earns the firm an Above Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

Berkshire Hathaway Inc. - Ordinary Shares - Class B

JPMorgan Chase & Co

Visa

Mastercard

Bank of America

Wells Fargo

Goldman Sachs

S&P Global

American Express

Citigroup

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. iShares US Financial Services ETF earns a High Process Pillar rating. The main contributor to the rating is that this fund tracks an index. Historical data, such as Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. Impressive risk-adjusted performance also supports the rating. This can be seen in the fund's five-year alpha calculated relative to the category average, which suggests that the process was successful over that period. The firm's five-year retention rate of 92% supports the process as well.

The investment strategy as stated in the fund's prospectus is:  The investment seeks to track the investment results of the Dow Jones U.S. Financial Services Index composed of U.S. equities in the financial services sector.  The fund generally will invest at least 80% of its assets in the component securities of its underlying index and in investments that have economic characteristics that are substantially identical to the component securities of its underlying index. The underlying index measures the performance of the financial services sector of the U.S. equity market. The fund is non-diversified. 

 The portfolio is overweight in financial services by 16.1 percentage points in terms of assets compared with the category average, and its consumer defensive allocation is similar to the category. The sectors with low exposure compared to category peers are technology and consumer cyclical, with technology underweighting the average portfolio by 5.7 percentage points of assets and consumer cyclical similar to the average. The portfolio is composed of 107 holdings and is relatively top-heavy. Of the strategy's assets, 62.5% are concentrated within the top 10 holdings, compared to the category’s 46.6% average. And in closing, in terms of portfolio turnover, on a year-over-year basis, 4% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.

High

Process

iShares US Financial Services ETF's strong equity team drives the strategy's Above Average People Pillar rating. There are three managers listed on the fund: Paul Whitehead, Jennifer Hsui, Greg Savage. Experience on the team is abundant, with 18 years of average portfolio management experience. Together, they manage a total of 257 strategies, with a Silver asset-weighted average Morningstar Medalist Rating, indicating the potential to deliver positive alpha relative to the category median in aggregate.  

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

Above Average

People

BlackRock offers compelling options across asset classes and vehicles. It earns an Above Average rating for Parent. 
The firm’s approximately USD 8 trillion in assets under management, as of Sept. 30, 2022, gives it unparalleled scale and influence. It is a market-leading index fund provider globally, and its iShares exchange-traded fund franchise offers a low-cost lineup of core funds that investors can use to build a well-diversified portfolio for dirt cheap. The firm can be more adventurous in its ETF launches than some peers, so not everything it launches is appropriate for the masses. As a result, it is likely to have more ETF closures than peers that stick to the basic building blocks.  
The firm’s active fixed-income and multi-asset efforts also stand out as some of the best in the industry. Those benefit from BlackRock’s commitment to building a first-class risk management system via its Aladdin analytics software. The software is also available for sale to other firms and has proved to be a popular option for competitors, a testament to its usefulness. 
More recently, the firm has shifted its focus to ESG offerings and incorporating ESG across its investment lineup, leading to a political backlash in the United States.
BlackRock isn’t the best at everything it tries to do, but retail investors, financial advisors, and large institutions could all build robust portfolios using BlackRock’s products.

Parent

iShares US Financial Services ETF

IYG invests in a market-cap-weighted subset of US stocks consisting exclusively of financial service firms.

iShares U.S. Broker-Dealers & Securities Exchanges ETF

Invesco KBW Bank ETF

Morgan Stanley

Vanguard Financials ETF

Financial Select Sector SPDR Fund

While most big banks beat on both lines in the first-quarter earnings season, higher rates may weigh on the financial ETFs over the medium term.

Bank ETFs in Focus on Mixed Q1 Earnings

First Trust Nasdaq Bank ETF

iShares U.S. Financials ETF

SPDR S&P Bank ETF

After a decade of decline following the 2008 financial crisis, U.S. banks are once again expanding their physical footprint, with 94 net new branches added in 2023, marking the first annual increase since 2012, as quoted in a Yahoo Finance article.

Is the Banking Sector Booming? 5 ETF Picks

It's time for full-fledged releases of quarterly earnings. Big banks will start reporting from next week.

Should You Buy Bank ETFs Before Earnings Releases?

If you're interested in broad exposure to the Financials - Broad segment of the equity market, look no further than the iShares U.S. Financial Services ETF (IYG), a passively managed exchange traded fund launched on 06/12/2000.

Should You Invest in the iShares U.S. Financial Services ETF (IYG)?

The financial sector, which accounts for around one--fifth of the S&P 500 Index, had a mixed Q4.

Bank ETFs in Focus on Mixed Q4 Earnings

While insurance benefits from persisting inflation, IYG has more banking exposures that would not benefit, at least to the extent that rates will positively correlate with inflation. With the picture being ambiguous, the PE doesn't offer a great margin of safety, and the expense ratio is not low despite finance being a well-known and liquid market vertical. We think that the pressures being put on banks currently, even if not extreme, will persist as we believe inflation may not come down rapidly. So we pass on IYG.

IYG: Some Duration Gap Bite-Back, But Insurance Still Looks Good

Chances of a broad-based earnings beat are low-to-moderate as several stocks are experiencing a negative ESP.

How Will Bank ETFs Perform in Light of Q4 Earnings?

Apple

Amazon

First Trust Dow Jones International Internet ETF

Alphabet

Microsoft

NVIDIA

Shopify

VanEck Vectors Semiconductor ETF

Tesla

While "Magnificent Seven" rocked the U.S. market in 2023, "Fab Four" will take the forefront, per a Motley Fool article, published on Yahoo Finance.

Will 2024 be a Year of "Fab Four" ETFs Instead of "Magnificent Seven"?

Advance Auto Parts

Chevron

iShares U.S. Energy ETF

iShares U.S. Consumer Goods ETF

iShares U.S. Technology ETF

Kraft Heinz

Coca-Cola

Occidental Petroleum

Energy Select Sector SPDR Fund

Billionaire investor Warren Buffett is known for his winning investing style.

Buffett's Favorite 4 Sectors: ETFs in Focus

iShares U.S. Financial Services ETF is currently trading near a 52-week low on fear of the Fed's tightening, which I believe is presenting a buying opportunity. The financial sector has passed the worst and is supported by robust economic and earnings growth. The sector appears significantly undervalued based on forward valuations.

IYG: Buy The Dip With Long-Term Investment Horizon

U.S. banking earnings have been an awaited one as investors' view toward the banking sector has dwindled this year.

Bank ETFs in Focus on Upbeat Earnings

Big banks will start releasing their quarterly numbers this week. Chances of a broad-based earnings beat are low-to-moderate as several stocks are experiencing a negative ESP.

How Will Bank ETFs Perform in Q3 Earnings Season?

Amplify Mobile Payments ETF

First Trust Nasdaq Oil & Gas ETF

Invesco Dynamic Food & Beverage ETF

Billionaire investor Warren Buffett is known for his value investing style. He has invested mainly in these stocks.

4 Sectors Warren Buffett Binges On: ETFs in Focus

Resilient consumers but a cautious corporate behavior pulled the strings on banking earnings in the second quarter.

Bank ETFs in Focus on Consumer vs Corporate Tug-of-War in Q2

Big banks will start releasing their quarterly numbers this week. Let's find out what's in store for bank ETFs.

How Will Bank ETFs Perform in Light of Q2 Earnings?

The iShares U.S. Financial Services ETF provides exposure to large-cap US financial services companies. IYG offers a solid dividend yield of 2.15% and an attractive dividend rate of $3.27. The fund also has a history of stable growth and consistent payments. Despite IYG's historical underperformance against the S&P 500, the fund's focus on large-caps positions it well to capitalize on the recovery of the banking sector.

IYG: Capitalize On Large-Caps As Banking Concerns Ease

UBS ETRACS Wells Fargo Business Development Cmpn Indx ETN 2015-26.4.41 Lkd to Wells Fargo Business Dvlpmnt Indx Ser B

VanEck Vectors BDC Income ETF

Davis Select Financial ETF

Direxion Daily Regional Banks Bull 3X Shares

iShares MSCI Europe Financials ETF

Fidelity MSCI Financials Index ETF

First Trust Financials AlphaDEX Fund

iShares U.S. Insurance ETF

iShares U.S. Regional Banks ETF

iShares Global Financials ETF

Invesco KBW High Dividend Yield Financial ETF

Invesco KBW Property & Casualty Insurance ETF

Invesco KBW Regional Banking ETF

SPDR S&P Capital Markets ETF

SPDR S&P Insurance ETF

SPDR S&P Regional Banking ETF

Invesco DWA Financial Momentum ETF

Invesco S&P SmallCap Financials ETF

First Trust NASDAQ ABA Community Bank Index Fund

Lipper Financial Services ETFs recorded their largest weekly outflow of the year over the past fund flows week (-$1.4 billion). On top of the bank failures, market participants are worried about the largest U.S. banks gaining an increasing market share by allowing them to take over the smaller regional institutions.

Regional Banking Concerns Produce Financial Services ETF Outflows

Is it time to follow Warren Buffett's lead and consider Bank of America stock? After Buffett's recent moves in bank stocks, it might be time to reassess the potential of Bank of America-heavy ETFs.

Following Buffett? Prime Time for Bank of America ETFs

U.S. banking earnings have probably not been so awaited since the 2008 financial crisis. To the sweet surprises of investors, most big bank earnings have come up with upbeat 1Q 2023 results.

Time for Big Bank ETFs on Upbeat Earnings?

Big banks will start releasing their quarterly numbers this week. The outlook is moderate this time.

How Are Bank ETFs Shaped Before Q1 Earnings?

After the turmoil which has embroiled banks on both sides of the Atlantic, in addition, to metrics, behavioral science also determines how depositors and investors behave. Tools used by regulators as well as innovative rescue plans indicate that America has put in place better contagion risk containment mechanisms than Europe, and also when compared to 2008.

IYG Vs. EUFN ETFs: U.S. Banks Seem More Protected Than European Ones

IYG invests in financial stocks across the United States. Medium-term economic recovery could put banks and credit card companies responsible for moving the needle.

IYG: Bank Runs Make This ETF A Lot Cheaper, And Closer To A Buy Zone

Silvergate Capital Corp

SVB Financial Group

Wall Street went into a tailspin last week due to the liquidation of Silicon Valley Bank and Silvergate Capital. Is it a case of specific business model failure or broad-based banking crisis?

Should You Buy the Dip in Big Bank ETFs & Overlook SVB Crisis?

The top five holdings make up about 75% of the total portfolio of Warren Buffett. These stocks have exposure to these specific sectors.

4 Sectors Warren Buffett Loves: ETFs in Focus

Three out of six big U.S. banks were able to beat overall this earnings season.

News for iShares US Financial Services ETF ETF (IYG)