NVIDIA, Apple, and Microsoft now drive 32.83% of the $113 billion iShares Russell 1000 Growth ETF’s returns.
The iShares Russell 1000 Growth ETF (IWF) now relies on just three stocks for nearly a third of its performance. NVIDIA, Apple, and Microsoft collectively represent 32.83% of the fund’s $113 billion in assets, with NVIDIA alone at 12.76%. This concentration stems from cap-weighted indexing, where larger market caps dominate holdings.
IWF’s top ten holdings make up 58.73% of the fund, reflecting the outsized influence of mega-cap stocks. NVIDIA’s $5.39 trillion market cap, Apple’s $4.44 trillion, and Microsoft’s $3.12 trillion underscore the fund’s exposure to a narrow segment of the market. Over five years, IWF and the Vanguard Growth ETF (VUG) delivered similar returns, despite IWF’s heavier concentration.
The fund’s structure leaves it vulnerable to volatility in these three stocks. A 20% drop in NVIDIA, Apple, and Microsoft would erase 6.5% of IWF’s value before other holdings could offset the decline.