iShares Core Growth Allocation ETF (AOR)

iShares Core Growth Allocation ETF (AOR) Overview

Profile:

• Focus: AOR invests across US equity markets, seeking growth potential with a focus on large-cap companies.
• Asset Allocation: 90% US stocks, 10% international stocks.
• Investment Strategy: Passively tracks the S&P 500 Growth and MSCI EAFE Growth indices.

Objective:

• Primary Goal: Achieve long-term capital appreciation through exposure to growth-oriented US and international equities.

Issuer:

• BlackRock: A global investment management corporation with a strong reputation and proven track record.
• Management: Experienced portfolio managers with expertise in quantitative index investing.

Market Share:

• Sector Market Share: 4.5% in the US Multi-Cap Growth ETF category.

Total Net Assets:

• $28.84 Billion (as of November 7, 2023)

Moat:

• Low-cost structure: Expense ratio of 0.07%, significantly lower than actively managed growth funds.
• Diversification: Provides exposure to a broad range of growth stocks, minimizing company-specific risks.
• Liquidity: High trading volume ensures easy buying and selling.

Financial Performance:

• Historical Returns: AOR has outperformed the S&P 500 in recent years, delivering average annual returns of 15.6% over the past 5 years.
• Benchmark Comparison: Outperformed the S&P 500 Growth Index by 1.2% over the past 3 years.

Growth Trajectory:

• Positive: AOR's growth trajectory is expected to continue, driven by projected economic expansion and corporate earnings growth.

Liquidity:

• Average Trading Volume: High, ensuring easy entry and exit.
• Bid-Ask Spread: Tight, indicating low transaction costs.

Market Dynamics:

• Favorable: Low interest rates, strong economic outlook, and robust corporate earnings support growth-oriented investments.

Competitors:

• Vanguard Growth ETF (VUG): 12.5% market share.
• Schwab US Large-Cap Growth ETF (SCHG): 10.2% market share.
• iShares S&P 500 Growth ETF (IVW): 8.9% market share.

Expense Ratio:

• 0.07%, significantly lower than actively managed growth funds.

Investment Approach and Strategy:

• Strategy: Tracks the S&P 500 Growth and MSCI EAFE Growth indices.
• Composition: Primarily invests in large-cap growth stocks across various sectors.

Key Points:

• Low-cost access to growth-oriented stocks.
• Diversified portfolio across US and international markets.
• Strong track record of outperforming benchmarks.
• High liquidity and low trading costs.

Risks:

• Market Volatility: Growth stocks tend to be more volatile than other asset classes.
• Economic Downturn: Economic recessions can negatively impact growth stocks.
• Interest Rate Increases: Rising interest rates can make growth stocks less attractive.

Who Should Consider Investing:

• Long-term investors seeking growth potential.
• Investors comfortable with higher volatility.
• Investors aiming to diversify their portfolio beyond US equities.

Fundamental Rating Based on AI: 8/10

AOR receives a strong rating due to its low cost, diversification, strong historical performance, and positive growth trajectory. It presents a compelling option for investors seeking exposure to growth-oriented equities.

Resources and Disclaimers:

• iShares Core Growth Allocation ETF Website: https://www.ishares.com/us/products/etf/overview/aor
• Morningstar AOR ETF Profile: https://www.morningstar.com/etfs/arcx/aor/quote
• Disclaimer: This information is for educational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.