IWD tracks the Russell 1000 Value Index, which selects Russell 1000 companies with lower price-to-book ratios and lower forecast growth. Compared with the broad market, the fund holds more financials, healthcare, industrials and energy and less technology. Value stocks have lagged growth stocks over much of the past decade but have often done better when interest rates rise or when economic recoveries favor cyclical sectors. The dividend yield is typically higher than that of growth funds. IWD is often paired with a growth fund to balance style exposure.
