If you're interested in broad exposure to the Mid Cap Value segment of the US equity market, look no further than the iShares Morningstar Mid-Cap Value ETF (IMCV), a passively managed exchange traded fund launched on June 28, 2004.
The fund is sponsored by Blackrock. It has amassed assets over $1.20 billion, making it one of the average sized ETFs attempting to match the Mid Cap Value segment of the US equity market.
Why Mid Cap Value
Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. These types of companies, then, have a good balance of stability and growth potential.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.06%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 1.87%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector -- about 18.5% of the portfolio. Industrials and Energy round out the top three.
Looking at individual holdings, Valero Energy Corp (VLO) accounts for about 1.63% of total assets, followed by Automatic Data Processing Inc (ADP) and Phillips 66 (PSX).
The top 10 holdings account for about 13.1% of total assets under management.
Performance and Risk
IMCV seeks to match the performance of the MORNINGSTAR US MID CAP BROAD VALUE INDEX before fees and expenses. The Morningstar US Mid Cap Broad Value Index comprises of mid-capitalization U.S. equities that exhibit value characteristics.
The ETF has gained about 19.88% so far this year and is up roughly 23.64% in the last one year (as of 10/22/2026). In the past 52-week period, it has traded between $77.65 and $98.49.
The ETF has a beta of 0.87 and standard deviation of 13.75% for the trailing three-year period. With about 273 holdings, it effectively diversifies company-specific risk.
Alternatives
iShares Morningstar Mid-Cap Value ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IMCV is an outstanding option for investors seeking exposure to the Style Box - Mid Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.
The iShares Russell Mid-Cap Value ETF (IWS) and the Vanguard Morningstar Mid-Cap Value ETF (VOE) track a similar index. While iShares Russell Mid-Cap Value ETF has $15.63 billion in assets, Vanguard Morningstar Mid-Cap Value ETF has $24.16 billion. IWS has an expense ratio of 0.23% and VOE charges 0.05%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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iShares Morningstar Mid-Cap Value ETF (IMCV): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).