Exploring the iShares U.S. Infrastructure ETF (IFRA): A New Player in the Utilities/Infrastructure Category
Launched on April 3, 2018, the iShares U.S. Infrastructure ETF (IFRA) is a smart beta exchange-traded fund (ETF) that aims to provide investors with broad exposure to the Utilities/Infrastructure sector of the market. This sector is essential for the functioning of modern society, as it includes companies that provide essential services such as water, electricity, natural gas, and telecommunications.
Key Features of the iShares U.S. Infrastructure ETF
The IFRA ETF uses a rules-based indexing approach to select its components. The index it tracks, the Dow Jones U.S. Infrastructure 100 Index, is designed to measure the performance of companies in the infrastructure sector based on certain fundamental characteristics. These characteristics include factors such as revenue from infrastructure-related businesses, infrastructure spending, and regulatory environment.
Performance and Holdings of the iShares U.S. Infrastructure ETF
As of the time of writing, the iShares U.S. Infrastructure ETF has returned approximately 12% since its inception, outperforming the S&P 500 index. The top holdings of the ETF include companies such as American Electric Power Company, NextEra Energy, and Duke Energy.
Impact of the iShares U.S. Infrastructure ETF on Individual Investors
For individual investors, the iShares U.S. Infrastructure ETF provides an opportunity to gain exposure to a sector that is crucial for the functioning of modern society. This sector is less volatile than the broader market and offers a steady stream of dividends. Moreover, investing in an ETF like IFRA allows for diversification across multiple companies within the sector, reducing individual company risk.
Impact of the iShares U.S. Infrastructure ETF on the World
At a global level, the launch of the iShares U.S. Infrastructure ETF is a positive development for the infrastructure sector. It provides institutional and retail investors with a new tool to invest in this sector, which is expected to grow significantly in the coming years. The increased investment in infrastructure is likely to lead to improved infrastructure in developing countries, which can help boost economic growth and reduce poverty.
Conclusion
In conclusion, the iShares U.S. Infrastructure ETF is a new player in the Utilities/Infrastructure sector of the market. It provides investors with broad exposure to this essential sector, using a rules-based indexing approach. The ETF has performed well since its inception and offers investors the opportunity to diversify their portfolio while gaining exposure to a sector that is less volatile than the broader market. Moreover, the increased investment in infrastructure that the ETF represents is likely to have a positive impact on the world, particularly in developing countries.
- The iShares U.S. Infrastructure ETF is a smart beta ETF launched on April 3, 2018.
- It aims to provide broad exposure to the Utilities/Infrastructure sector of the market.
- The ETF uses a rules-based indexing approach and tracks the Dow Jones U.S. Infrastructure 100 Index.
- The top holdings of the ETF include American Electric Power Company, NextEra Energy, and Duke Energy.
- The ETF has returned approximately 12% since its inception and is less volatile than the broader market.
- The increased investment in infrastructure that the ETF represents is likely to have a positive impact on the world, particularly in developing countries.
