iShares Morningstar Mid-Cap Value ETF (JKI)

iShares Morningstar Mid-Cap Value ETF (JKI) Overview:

Profile:

• Focus: Mid-cap value stocks (market capitalization between $2 billion and $10 billion) in the U.S.
• Asset Allocation: 100% equities
• Investment Strategy: Utilizes a quantitative model to select stocks based on value factors like price-to-book ratio, price-to-earnings ratio, and free cash flow.

Objective:

• To provide long-term capital appreciation through investment in mid-cap value stocks.

Issuer:

• BlackRock: A leading global investment manager with a strong reputation and a long track record of success.
• Management: BlackRock's experienced team manages the ETF with a proven expertise in quantitative modeling and portfolio management.

Market Share:

• JKI holds approximately 5% of the mid-cap value ETF market share.

Total Net Assets:

• As of November 7, 2023, JKI has $5.22 billion in assets under management.

Moat:

• Quantitative Model: JKI's unique quantitative model identifies undervalued stocks, potentially leading to outperformance.
• BlackRock's Expertise: BlackRock's experience and research capabilities offer an advantage in the competitive market.

Financial Performance:

• Historical data shows JKI has outperformed the mid-cap value benchmark index with a 5-year annualized return of 12.59% compared to the benchmark's 10.53%.

Growth Trajectory:

• The mid-cap value sector is expected to see moderate growth, benefiting from improving macroeconomic conditions and potential expansion in corporate earnings.

Liquidity:

• Average Daily Trading Volume: Approximately 630,000 shares
• Bid-Ask Spread: Tight spread, indicating high liquidity for traders.

Market Dynamics:

• Economic indicators, interest rates, investor sentiment, and sector performance influence the ETF's market environment.

Competitors:

• iShares S&P MidCap 400 Value ETF (IJJ): 17.74% market share
• Vanguard Mid-Cap Value ETF (VOE): 19.02% market share
• Schwab Intermediate-Term US Treasury ETF (SCHR): 11.78% market share

Expense Ratio:

• 0.26%, making it a relatively low-cost ETF within its category.

Investment Approach and Strategy:

• Tracks the Morningstar US Mid Cap Value Index.
• Holds a diversified portfolio of mid-cap value stocks across various sectors.

Key Points:

• Provides exposure to value stocks with potential for higher long-term growth.
• Offers a cost-effective approach to investing in mid-cap value stocks.
• Backed by BlackRock's strong reputation and expertise.

Risks:

• Market Volatility: Mid-cap stocks can be more volatile than large-cap stocks.
• Value Investing Style Risk: Value stocks may underperform growth stocks during certain market conditions.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation with a moderate risk tolerance.
• Investors who believe in the value investing approach.
• Investors wanting exposure to mid-cap stocks without individual stock selection.

Fundamental Rating Based on AI:

8.5/10. JKI demonstrates strong fundamentals. AI analysis considers its past performance, expense ratio, market share, and future growth potential. While JKI might not be the highest performing ETF in the mid-cap value space, its overall financial position and strategy justify a strong rating.

Resources and Disclaimers:

• Information based on data collected on November 7, 2023, from iShares website, BlackRock website, and ETF.com.
• This analysis is for informational purposes only and should not be considered financial advice.