VLUE

VLUE: Transparent Value With Little Industry Bets
February 28, 2023

Summary

• The core idea of value investing remains unchanged since its introduction by Graham and Dodd in the 1930s: fundamentally cheap stocks tend to beat expensive stocks on average.
• The iShares Edge MSCI USA Value Factor ETF tracks the MSCI USA Enhanced Value Index and provides cheap, efficient, and transparent systematic value exposure among US large caps.
• Importantly, the underlying value index incorporates several insights of the literature on the value factor (multiple value signals, value-rankings within sectors, and no unintended industry bets).
• For investors who want US value exposure without running into unintended sector bets and without taking too much active risk, VLUE is an interesting instrument.