A new pair of actively managed funds, the iShares Enhanced International Large-Cap ETF (IEIL) and iShares Enhanced International Small-Cap ETF (IEIS), we’re launched by Blackrock on Feb. 26.
Rather than being linked to equity index benchmarks, the new ETFs screen stock holdings based upon multiple factors including quality of earnings, attractive valuations and lower relative market sizes.
“Factor investing has become increasingly popular as investors look for opportunities to potentially outperform the market over the long-term,” said Patrick Dunne, head of iShares Global Markets and Investments. “The new iShares Enhanced International ETFs combine well-known factors and are of interest to investors who prefer a blending of factors in a single ETF to effectively maximize diversification and manage risk.”
Factor based investing emphasizes certain investment characteristics that explain the risk and return behavior of a stock or asset class.
iShares currently offers other factor products including four iShares MSCI USA Factor ETFs that focus on single factors and four iShares Minimum Volatility ETFs that minimize market volatility.
IEIL holds 172 international stocks from developed countries and charges annual expenses of 0.35%. IEIS owns 389 international small cap stocks and charges 0.49%. Both ETFs exclude U.S. equities.
The entire iShares Factor ETF suite had over $7.3 billion in assets under management (AUM) as of Feb. 21.