Last week we witnessed substantial redemption activity in a Mid Cap ETF based on a Russell Index.
The iShares Russell Mid Cap (IWR - News) lost approximately $500 million in assets under management via redemption activity (equal to nearly 10% of assets in the fund) as the fund dipped below its 50 day moving average to end the week after briefly challenging it on Monday and Tuesday of last week.
Classified in the “Mid Cap Blend” category, as the fund is not seen as having either a “Growth” nor a “Value” bias, it is difficult to say if the assets that left the fund are being allocated or “swapped” into other U.S. Mid Cap Equity products or if they are simply being parked in cash or traded into another asset class altogether.
We note that IWR is the third largest ETF in this category, following MDY (SPDR Midcap Trust) and IJH (iShares S&P Midcap 400) in terms of net assets under management.
MDY and IJH, as their names suggest, follow the same S&P 400 Midcap Index, while IWR as mentioned is linked to a Russell Midcap Index.
Other notable funds in the category are VO (Vanguard Mid Cap), FNX (First Trust Mid Cap Core AlphaDEX), SCHM (Schwab U.S. Mid Cap), JKG (iShares Morningstar Mid Core Index), RWK (RevenueShares Mid Cap), EMM (SPDR Dow Jones Mid Cap), IVOO (Vanguard S&P Mid Cap 400), CZA (Guggenheim Mid Cap Core), PXMC (PowerShares Fundamental Pure Mid Core), FMM (Focus Morningstar Mid Cap), and EWMD (Guggenheim S&P Midcap 400 Equal Weight).
Year to date, Mid Caps have lagged their U.S. Large Cap counterparts, with the S&P 500 Index up 6.30% versus IWR (+4.92%), IJH (+4.41%), and MDY (+4.38%) for example. In the trailing one year period, the performance lag is still evident, with the S&P 500 rising 5.04% during this time frame versus IWR (-1.12%), IJH (-1.97%), and MDY (-1.50%).
iShares Russell Mid Cap