VLUE: Transparent Value With Little Industry Bets

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.

Darren415

After writing a rather long article about QVAL and (systematic) value investing in general, this one examines the next ETF of my peer-group: the iShares Edge MSCI USA Value Factor ETF (BATS:VLUE).

For a more comprehensive overview on systematic

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