Morningstar Rating

ETF Research and Analysis

by Robert Goldsborough
Suitability
IShares North American Tech-Software IGV offers investors exposure to software companies--specifically, companies that produce client-server, enterprise, Internet, PC, and entertainment software. As a subsector-specific   Read more 

Bull Case

Most of the firms in this fund have healthy balance sheets, which should support continued investment in R&D and growth strategies.
Large-cap software firms with significant competitive advantages (like high switching costs and steady maintenance revenues) serve as the cornerstone of the portfolio. In fact, wide- and narrow-moat firms comprise about 39% and 31% of total assets, respectively.
Major players like Microsoft and Oracle have done a solid job shoring up their defenses and providing paths forward in a world of cloud computing and mobile devices. Read more 

Bear Case

A pullback in IT spending could weigh on the performance of this ETF.
Cloud computing is a disruptive force, and large software providers have had to develop new products that will likely cannibalize their legacy businesses.
Some top holdings, such as Intuit and Adobe, face fairly mature markets for many of their top product lines. Read more 

Reduce Volatility and Increase Yield With This ETF 
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