Morningstar Key Indicators for iShares Russell 1000 Growth ETF
- Morning Star Medalist Rating: Silver
- Process Pillar: Above Average
- Human Resources Pillar: Above Average
- Main Pillar: Above Average
The iShares Russell 1000 Growth ETF (IWF) boasts low fees and infrequent trading, which gives it an edge over actively managed funds.
This fund tracks the Russell 1000 Growth Index, focusing on the top half of growing companies in the large-cap and mid-cap markets. It begins with stocks from the Russell 1000 Index—comprising the largest 1,000 U.S. companies—and assigns a style score based on three key metrics. These metrics aim to identify companies demonstrating significant growth potential through high earnings growth rates and robust sales growth.
There’s a possibility that some stocks might show characteristics that blend value and growth. If that occurs, the growth focus of ETFs could diminish a bit. Still, the portfolio remains aligned with notable growth prospects. The growth metrics, such as historical earnings and sales growth, indeed reflect the averages of high-growth funds in the Morningstar category.
Focusing on companies with strong growth traits does come with risks. There’s the chance of encountering growth traps where overvalued stocks fail to meet their high expectations. Emphasizing market capitalization can amplify this risk, but generally, the market seems to consider these stocks fairly valued over the long haul.
The sector allocations here are similar to those of the average fund, but there remains a significant tilt toward technology, which has been stable from 2020 to September 2025. By the end of September 2025, names like Nvidia, Microsoft, and Apple led the top holdings, together making up 36% of the ETF, while tech stocks constituted 54% of the portfolio.
Even though it had some challenges, the iShares Russell 1000 Growth ETF has outshined many of its peers. It began trading at the height of the dot-com boom, and following the bubble’s burst, it fell more steeply than others, partly due to a lack of capital reserves. However, performance has improved considerably, and recent results have been quite promising.
iShares Russell 1000 Growth ETF: Performance Highlights
After a rocky beginning, the ETF outdid the average large-growth category fund by 1.26 percentage points annually since its May 2000 launch, up until September 2025. The annualized return of 8.39% during this time might not seem particularly impressive, but it’s essential to remember the timing coincided with the dot-com bubble peak. However, looking at the ten-year performance paints a more favorable picture: an annualized return of 18.62%, surpassing the peer average by 3.39 percentage points.
From its inception in 2000 to 2007, the iShares Russell 1000 Growth’s returns were somewhat erratic—falling 2.61% compared to an average drop of 0.85% in large-cap growth funds. After that, the fund regained its footing, finishing above average in 15 of 17 years from 2008 to 2024, with its worst underperformance being less than one percentage point during the two years it lagged.
Technology giants like Nvidia, Apple, and Microsoft have largely fueled the ETF’s success over the past five years leading up to September 2025. While the average peer also benefitted from solid tech components, the iShares Russell 1000 Growth’s larger tech allocation helped it stay ahead, as those stocks on average outperformed.
This ETF continues to offer low fees and reduces trading volume, putting it at an advantage over more actively managed funds. These factors should serve to bolster its competitive position.
