IWX: A Look at the iShares Russell Top 200 Value ETF
Large-Cap Values Consistently Trail Behind in Market Performance
Gear up for an in-depth review of the iShares Russell Top 200 Value ETF (NYSEARCA:IWX), a passively managed exchange-traded fund (ETF) that delves into the world of large-cap American stocks. As a fund focused on fundamental measures like lower price-to-book ratios, lower sales-per-share historical growth, and lower forecasted growth, IWX aims to identify hidden gems in the U.S. stock market.
The Skinny on IWX: Is It Worth the Investment?
The question on every investor's mind: Should IWX be your next big financial move, or is it better to stick with alternatives like SPY, the SPDR S&P 500 ETF, or other large-cap assets? Let's weigh the pros and cons.
Our analysis shows that IWX offers decent performance compared to peers, but the trend for underperforming value has persisted. IWX's struggles against SPY and other large-cap funds with growth characteristics, like SPY, while beating some of its value peers, such as IWD, which boasts a broader portfolio, leaves room for improvement. For those seeking pure value, we recommend the iShares S&P 500 Value ETF (IVE). While IWX may provide large-cap value exposure, IVE's outperformance makes it the standout choice from a pure performance perspective.
Fundamentals: The Inside Scoop on IWX
Launched in 2009 by Blackrock after the financial crisis, IWX's mandate is to generally track large-cap U.S. stocks that exhibit value characteristics. The index targeted by IWX selects and weighs securities based on three fundamental metrics - lower price-to-book ratios, lower sales-per-share historical growth, and lower forecasted growth relative to all securities in the Russell Top 200.
As of June 26, 2025, IWX boasts a net asset value (NAV) of approximately $2.7Bn and a daily volume of over 120K shares traded worth more than $10MM. With a portfolio turnover of around 14%, IWX attempts to replicate its index based on a few value factors. Despite these efforts, the ETF's results have not shown promising performance over the past several years, as depicted in charts showing returns well below both SPY and IVE.
The fund comes with a yearly expense ratio of 0.2%, which is considered reasonable given the differentiation and customization of the portfolio. However, the ongoing impact of the Trump tariffs and the persistent performance issues of IWX create doubts about its potential for an outperforming year.
IWX's Portfolio & Risk Profile
When comparing IWX's portfolio to peers, you'll notice subtle differences in the portfolio breakdown but not many. The fund's main distinction lies in the underweighting of healthcare and an overweighting in financials, when compared to its index benchmark and overall large-cap value universe. The portfolio's equities are skewed value, with a lower average P/B of 2.74 and P/E of 20, but the ratios are slightly higher than SPY and IVE, making it a middle-ground option for those seeking value.
From a risk perspective, IWX's current beta of 0.83 indicates more volatility than the market. Upon examining the Sharpe ratio, a measure of risk-adjusted returns, it becomes clear that the fund has not generated excess returns over the risk-free rate, and the overall volatility is not worth the return structure, as the Sharpe ratio for the fund is 0.34.
The Bottom Line: To IWX or Not to IWX?
In the end, IWX is an okay pick, but better options exist, like IWE and VTV. Its narrow focus on few large-cap value stocks makes it less competitive compared to peers that offer broader exposure and stronger performance. If investors insist on having value in their portfolio, IWX is a sufficient choice, but it has struggled against SPY for years. For those seeking true value in large-cap public equities, it might be worth exploring options further down the market.
Investing in IWX, the iShares Russell Top 200 Value ETF, may not offer the best return on investment, as its performance has consistently lagged behind funds like SPY and IVE. Despite a reasonable expense ratio and a focus on value stocks, the fund's risk-adjusted returns are not commensurate with its volatility, making other options like IWE and VTV more attractive for investors seeking value in large-cap public equities.
The fund's portfolio differs slightly from peers, with an underweighting in healthcare and an overweighting in financials, but this specialization may not compensate for its underperformance compared to broader funds offering similar value characteristics.
