ETF Risk Report: IYG Buyer beware: Every ETF holds the full risk of its underlying equities Disclosures in the best interest of investors iShares U.S. Financial Services ETF Gray Swan Event Risks exist for every equity held by IYG. Gray swan events include accounting fraud, management failures, failed internal controls, M&A problems, restatements, etc. These risks occur infrequently, but Gray Swan Event Factor for IYG 1.02% consistently for all equities. Equities account for 99.36% of IYG’s assets. Most investors ignore these risks until after they are disclosed; whereupon a stock’s price drops precipitously. Just as insurance companies can predict likely costs for a driver’s future car accidents based on the driver’s history, Watchdog Research contacts each ETF asking how they notify investors about we predict the likely cost (price drop) for IYG following accounting governance risks in equities in their fund. We will publish their response gray swan disclosures within its holdings. The expected when received. price decrease across the IYG equity portfolio is 1.02%. However, individual equity risks vary signi cantly. This report helps investors know their risk exposure.
Inception Date: 06/12/2020 Year-to-Date Return: 14.51% The iShares U.S. Financial Services ETF tracks the investment results of the Dow Jones U.S. Financial Net Assets: $1.5b 1-Year Return: 69.70% Services Index, composed of U.S. equities in the nancial services sector, including banks; asset managers; Price: $171.27 3-Year Return: 11.39% investments services; and consumer, specialty, and Net Asset Value (NAV): $171.05 5-Year Return: 18.00% mortgage nance. The Fund uses a passive or indexing approach and invests by sampling the Index, holding a Net Expense Ratio: 0.42% Yield: 1.38% collection of securities that approximates the full Index in key investment characteristics (such as market As of: 03/31/2021 capitalization and industry weightings), fundamentals (such as return variability and yield), and liquidity.
Company Ticker Held Current GSEF Category Value Top Holdings by Value
Jpmorgan Chase & Co. JPM Long 1.04% Low $274m This table shows Gray Swan Event Factors for the top ten equity holdings by dollar-value, as of Sep 24, 2021. Visa Inc. V Long 2.70% Mid $230m Investors should invest in ETFs only when they adequately Mastercard Inc. MA Long 0.57% Low $186m understand an ETF’s risks. Buyer beware. ETF prospectuses generally acknowledge that ETF managers Bank Of America Corp. BAC Long 0.74% Low $181m do NO traditional risk analysis on equities in their fund. Wells Fargo & Company WFC Long 1.10% Low $109m Our Gray Swan Event Factors are meant to inform investors of signi cant traditional accounting and Citigroup Inc. C Long 1.00% Low $85.1m managerial risks for the equities in each ETF.
Morgan Stanley MS Long 1.24% Low $79.4m ETF Risk Reports are published quarterly on dedicated Goldman Sachs Group... GS Long 1.39% Low $75.2m platforms like Factset, Re nitiv, Capital IQ etc. Weekly updates are available for a paid subscription. Blackrock Inc. BLK Long 0.39% Low $72.2m For more details contact: [email protected] The Charles Schwab ... SCHW Long 0.62% Low $63.6m
Company Ticker Held Current GSEF Category Value Riskiest Holdings
New York Community ... NYCB Long 6.69% High $2.99m This table shows the individual Gray Swan Event Factors for this ETF’s most at-risk equities as of Sep 24, 2021. M&T Bank Corp. MTB Long 2.96% Mid $10.9m The average equity GSEF across 6,500 public equities is Ares Management Lp ARES Long 2.92% Mid $4.11m 1.25%. Equities with a GSEF between 5% and 10% are considered high risk. Equities with a GSEF above 10% are Visa Inc. V Long 2.70% Mid $230m extreme risks. Gray Swan Event Factors are derived from skilled analysts Jeffries Financial ... JEF Long 2.55% Mid $4.01m charting 15 years of negative gray swan event disclosures Credit Acceptance C... CACC Long 2.33% Mid $3.05m against stock price declines following such disclosures. A Gray Swan Event Factor is an assessment of the Fnb Corp. FNB Long 1.89% Low $2.31m likelihood of, and 12-month price risk for, gray swan Glacier Bancorp Inc. GBCI Long 1.88% Low $3.09m events for each equity.
Valley National Ban... VLY Long 1.84% Low $3.2m
United Bankshares Inc. UBSI Long 1.82% Low $2.87m
Watchdog Research, Inc. • www.watchdogresearch.com • [email protected] • (855) 820-6272 This table lists the equity holdings for iShares U.S. Financial Services ETF ranked by highest GSE Factor (riskiest rst). We list all equities (US and foreign) for this ETF. However, some foreign listings only show via a ticker.
To further evaluate risks, you can access details for each company by opening its Brief Watchdog Report available for viewing and pdf download. The report is free to readers for their personal consumption and it includes the executive summary data pulled from the full Watchdog Report.
To learn more about the full Watchdog and GSEF Reports go to last page or visit watchdogresearch.com.
Company Access Details Ticker Held Current GSEF Category Value
New York Community Bancorp Inc. Watchdogresearch.com/watchdog/$NYCB NYCB Long 6.69% High $2.99m
M&T Bank Corp. Watchdogresearch.com/watchdog/$MTB MTB Long 2.96% Mid $10.9m
Ares Management Lp Watchdogresearch.com/watchdog/$ARES ARES Long 2.92% Mid $4.11m
Visa Inc. Watchdogresearch.com/watchdog/$V V Long 2.70% Mid $230m
Jeffries Financial Group, Inc. Watchdogresearch.com/watchdog/$JEF JEF Long 2.55% Mid $4.01m
Credit Acceptance Corp. Watchdogresearch.com/watchdog/$CACC CACC Long 2.33% Mid $3.05m
Fnb Corp. Watchdogresearch.com/watchdog/$FNB FNB Long 1.89% Low $2.31m
Glacier Bancorp Inc. Watchdogresearch.com/watchdog/$GBCI GBCI Long 1.88% Low $3.09m
Valley National Bancorp. Watchdogresearch.com/watchdog/$VLY VLY Long 1.84% Low $3.2m
United Bankshares Inc. Watchdogresearch.com/watchdog/$UBSI UBSI Long 1.82% Low $2.87m
Tfs Financial Corp. Watchdogresearch.com/watchdog/$TFSL TFSL Long 1.47% Low $564k
Virtu Financial, Inc. Watchdogresearch.com/watchdog/$VIRT VIRT Long 1.44% Low $1.29m
T. Rowe Price Group, Inc. Watchdogresearch.com/watchdog/$TROW TROW Long 1.41% Low $26.2m
Goldman Sachs Group Inc. Watchdogresearch.com/watchdog/$GS GS Long 1.39% Low $75.2m
Lendingtree, Inc. Watchdogresearch.com/watchdog/$TREE TREE Long 1.32% Low $1.4m
First Horizon Corp Watchdogresearch.com/watchdog/$FHN FHN Long 1.29% Low $5.57m
Tradeweb Markets Inc. Watchdogresearch.com/watchdog/$TW TW Long 1.28% Low $5.18m
Morgan Stanley Watchdogresearch.com/watchdog/$MS MS Long 1.24% Low $79.4m
Green Dot Corp. Watchdogresearch.com/watchdog/$GDOT GDOT Long 1.22% Low $1.2m
Rocket Companies, Inc. Watchdogresearch.com/watchdog/$RKT RKT Long 1.14% Low $1.56m
First Citizens Bancshares Inc. Watchdogresearch.com/watchdog/$FCNCA FCNCA Long 1.14% Low $3.53m
Bok Financial Corp Watchdogresearch.com/watchdog/$BOKF BOKF Long 1.13% Low $1.58m
Janus Henderson Group Plc Watchdogresearch.com/watchdog/$JHG JHG Long 1.12% Low $3.85m
Wells Fargo & Company Watchdogresearch.com/watchdog/$WFC WFC Long 1.10% Low $109m
Jpmorgan Chase & Co. Watchdogresearch.com/watchdog/$JPM JPM Long 1.04% Low $274m
Santander Consumer Usa Holdings Inc. Watchdogresearch.com/watchdog/$SC SC Long 1.03% Low $1.53m
Citigroup Inc. Watchdogresearch.com/watchdog/$C C Long 1.00% Low $85.1m
Umb Financial Corp. Watchdogresearch.com/watchdog/$UMBF UMBF Long 0.96% Low $2.39m
Citizens Financial Group Inc. Watchdogresearch.com/watchdog/$CFG CFG Long 0.93% Low $11.4m
Regions Financial Corp. Watchdogresearch.com/watchdog/$RF RF Long 0.92% Low $11.3m
Svb Financial Group Watchdogresearch.com/watchdog/$SIVB SIVB Long 0.92% Low $17.6m
Moodys Corp. Watchdogresearch.com/watchdog/$MCO MCO Long 0.92% Low $34m
Slm Corporation Watchdogresearch.com/watchdog/$SLM SLM Long 0.89% Low $3.96m
Lpl Financial Holdings Inc. Watchdogresearch.com/watchdog/$LPLA LPLA Long 0.89% Low $6.31m
Synovus Financial Corp. Watchdogresearch.com/watchdog/$SNV SNV Long 0.87% Low $3.83m
Msci Inc. Watchdogresearch.com/watchdog/$MSCI MSCI Long 0.86% Low $25.6m
Stifel Financial Corp. Watchdogresearch.com/watchdog/$SF SF Long 0.86% Low $3.97m
Watchdog Research, Inc. • www.watchdogresearch.com • [email protected] • (855) 820-6272 Company Access Details Ticker Held Current GSEF Category Value
Invesco Ltd. Watchdogresearch.com/watchdog/$IVZ IVZ Long 0.85% Low $5.91m
First Financial Bankshares Inc. Watchdogresearch.com/watchdog/$FFIN FFIN Long 0.84% Low $4.1m
Interactive Brokers Group, Inc. Watchdogresearch.com/watchdog/$IBKR IBKR Long 0.81% Low $3.14m
Popular Inc. Watchdogresearch.com/watchdog/$BPOP BPOP Long 0.80% Low $3.54m
Bank Of New York Mellon Corp. Watchdogresearch.com/watchdog/$BK BK Long 0.79% Low $24.1m
Home Bancshares Inc. Watchdogresearch.com/watchdog/$HOMB HOMB Long 0.78% Low $2.19m
A liated Managers Group, Inc. Watchdogresearch.com/watchdog/$AMG AMG Long 0.75% Low $3.76m
Bank Of America Corp. Watchdogresearch.com/watchdog/$BAC BAC Long 0.74% Low $181m
Apollo Global Management Llc Watchdogresearch.com/watchdog/$APO APO Long 0.74% Low $7.69m
Wintrust Financial Corp. Watchdogresearch.com/watchdog/$WTFC WTFC Long 0.73% Low $2.51m
Commerce Bancshares Inc. Watchdogresearch.com/watchdog/$CBSH CBSH Long 0.73% Low $4.61m
Radian Group Inc. Watchdogresearch.com/watchdog/$RDN RDN Long 0.72% Low $2.52m
Webster Financial Corp. Watchdogresearch.com/watchdog/$WBS WBS Long 0.72% Low $2.84m
Zions Bancorporation Watchdogresearch.com/watchdog/$ZION ZION Long 0.71% Low $5.04m
Fifth Third Bancorp. Watchdogresearch.com/watchdog/$FITB FITB Long 0.69% Low $15.7m
Lazard Ltd. Watchdogresearch.com/watchdog/$LAZ LAZ Long 0.69% Low $3.01m
Onemain Holdings, Inc. Watchdogresearch.com/watchdog/$OMF OMF Long 0.69% Low $3.23m
Essent Group Ltd. Watchdogresearch.com/watchdog/$ESNT ESNT Long 0.69% Low $2.96m
Cullen/Frost Bankers, Inc. Watchdogresearch.com/watchdog/$CFR CFR Long 0.68% Low $3.71m
East West Bancorp Inc. Watchdogresearch.com/watchdog/$EWBC EWBC Long 0.68% Low $5.95m
Intercontinental Exchange, Inc. Watchdogresearch.com/watchdog/$ICE ICE Long 0.68% Low $38.9m
Equitable Holdings, Inc. Watchdogresearch.com/watchdog/$EQH EQH Long 0.68% Low $6.85m
Mgic Investment Corp. Watchdogresearch.com/watchdog/$MTG MTG Long 0.67% Low $2.71m
Pinnacle Financial Partners Inc. Watchdogresearch.com/watchdog/$PNFP PNFP Long 0.67% Low $3.94m
Umpqua Holdings Corp. Watchdogresearch.com/watchdog/$UMPQ UMPQ Long 0.66% Low $2.41m
Firstcash, Inc. Watchdogresearch.com/watchdog/$FCFS FCFS Long 0.66% Low $1.86m
People's United Financial, Inc. Watchdogresearch.com/watchdog/$PBCT PBCT Long 0.66% Low $4.3m
S&P Global Inc. Watchdogresearch.com/watchdog/$SPGI SPGI Long 0.65% Low $57.6m
Carlyle Group Inc. Watchdogresearch.com/watchdog/$CG CG Long 0.65% Low $3.21m
Capital One Financial Corp. Watchdogresearch.com/watchdog/$COF COF Long 0.64% Low $40.7m
Prosperity Bancshares Inc. Watchdogresearch.com/watchdog/$PB PB Long 0.64% Low $3.93m
Franklin Resources Inc. Watchdogresearch.com/watchdog/$BEN BEN Long 0.63% Low $5.11m
The Charles Schwab Corporation Watchdogresearch.com/watchdog/$SCHW SCHW Long 0.62% Low $63.6m
Nasdaq, Inc. Watchdogresearch.com/watchdog/$NDAQ NDAQ Long 0.61% Low $11.8m
Marketaxess Holdings Inc. Watchdogresearch.com/watchdog/$MKTX MKTX Long 0.60% Low $10.2m
Pnc Financial Services Group, Inc. Watchdogresearch.com/watchdog/$PNC PNC Long 0.58% Low $47.2m
Sei Investments Co. Watchdogresearch.com/watchdog/$SEIC SEIC Long 0.57% Low $4.28m
Keycorp Watchdogresearch.com/watchdog/$KEY KEY Long 0.57% Low $11.7m
Mastercard Inc. Watchdogresearch.com/watchdog/$MA MA Long 0.57% Low $186m
Blackstone Group L.P. Watchdogresearch.com/watchdog/$BX BX Long 0.55% Low $38.7m
Raymond James Financial Inc. Watchdogresearch.com/watchdog/$RJF RJF Long 0.55% Low $9.27m
Synchrony Financial Watchdogresearch.com/watchdog/$SYF SYF Long 0.54% Low $15.3m
Ally Financial Inc. Watchdogresearch.com/watchdog/$ALLY ALLY Long 0.51% Low $10.8m
Watchdog Research, Inc. • www.watchdogresearch.com • [email protected] • (855) 820-6272 Company Access Details Ticker Held Current GSEF Category Value
Us Bancorp Watchdogresearch.com/watchdog/$USB USB Long 0.50% Low $45m
Ameriprise Financial Inc. Watchdogresearch.com/watchdog/$AMP AMP Long 0.50% Low $16.8m
Kkr & Co. L.P. Watchdogresearch.com/watchdog/$KKR KKR Long 0.49% Low $20.1m
Discover Financial Services Watchdogresearch.com/watchdog/$DFS DFS Long 0.49% Low $21m
Northern Trust Corp. Watchdogresearch.com/watchdog/$NTRS NTRS Long 0.47% Low $14m
Factset Research Systems Inc. Watchdogresearch.com/watchdog/$FDS FDS Long 0.46% Low $7.41m
Huntington Bancshares Inc. Watchdogresearch.com/watchdog/$HBAN HBAN Long 0.46% Low $12.3m
State Street Corp. Watchdogresearch.com/watchdog/$STT STT Long 0.46% Low $16.7m
Morningstar, Inc. Watchdogresearch.com/watchdog/$MORN MORN Long 0.45% Low $3.25m
Cme Group Inc. Watchdogresearch.com/watchdog/$CME CME Long 0.45% Low $44.5m
Cboe Global Markets, Inc. Watchdogresearch.com/watchdog/$CBOE CBOE Long 0.45% Low $7.42m
American Express Co. Watchdogresearch.com/watchdog/$AXP AXP Long 0.42% Low $62.6m
Blackrock Inc. Watchdogresearch.com/watchdog/$BLK BLK Long 0.39% Low $72.2m
Truist Financial Corp - TFC Long - NA $43.5m
First Republic Bank/Ca - FRC Long - NA $19.2m
Signature Bank - SBNY Long - NA $8.26m
Western Alliance Bancorp - WAL Long - NA $5.63m
Coinbase Global Inc Class A - COIN Long - NA $4m
Bank Ozk - OZRK Long - NA $3m
Prog Holdings, Inc. Watchdogresearch.com/watchdog/$PRG PRG Long - NA $1.9m
Federated Investors Inc Cl B - FII Long - NA $1.86m
Upstart Holdings, Inc. Watchdogresearch.com/watchdog/$UPST UPST Long - NA $1.26m
Uwm Holdings Corp Class A - UWMC Long - NA $284k
Watchdog Research, Inc. • www.watchdogresearch.com • [email protected] • (855) 820-6272 This is a story about four people investing in ETFs. They are named Everybody, Somebody, Anybody and Nobody.
Everybody wanted to buy ETFs because ETFs are such great investments. “Not so fast,” said Somebody. “Nobody should buy an ETF without rst understanding the accounting and disclosure risks for the ETF’s basket of stocks.”
Everybody scoffed: “Don’t be silly! What could go wrong? Let’s just BUY immediately! Somebody at the ETF must have done that work for us.” Anybody explained how Everybody was wrong in their thinking: “Most ETF prospectuses speci cally say Nobody at the ETF actually does traditional stock risk analysis.” Everybody read many ETF prospectuses, and, sure enough, Anybody was right! So, while Everybody should know the risks before buying an ETF, Nobody was actually doing it.
Until this report was created.
Watchdog Research, Inc. educates investors on accounting and disclosure risks.
Full Watchdog and Gray Swan Event Factor Reports offer in-depth information about identi ed risks. See more about Watchdog Research Inc. and available subscriptions below.
Watchdog Research, Inc. is an independent research organization that does not make "buy", "sell" or "hold" recommendations and does not trade in public stocks.
About Watchdog Research, Inc.
Watchdog Research, Inc. is an independent research provider and publisher of Watchdog Reports.
Watchdog Research analysts track gray swan events and critical disclosures for over 4,500 public companies. Gray swan events are reliably predictable, yet infrequent disclosures that expose a company's failures in accounting, internal controls, management integrity and which negatively impact stock prices or increase probabilities for a lawsuit.
Watchdog Reports identify red ags, issues, and other anomalies in nancial reporting. The reports contain warning signs, red ags, material disclosures, and peer analysis for use in valuation, risk analysis, due diligence research, and idea generation. Watchdog Reports are designed to assist investment professionals ful ll their duciary or suitability obligations and to help investors, executives, board members, regulators and educators learn what they need to know about publicly traded companies.
Watchdog Research, Inc. is headquartered in Ave Maria, FL, and it utilizes over 75 specialists and analysts to provide accurate and timely information to its readers. So far, it has delivered 300,000 public company reports to over 27,000 individuals, from over 9,000 investment rms and to 4,000+ public company corporate board members.
Watchdog Reports
An annual subscription to Watchdog Reports costs $5,000 per year per individual subscriber (group subscription rates available). Subscriptions provide unlimited access to 4,500+ public company Watchdog Reports. Reports are updated weekly. A subscription can also entitle users to download the reports weekly on Factset, Re nitiv (ex Thomson Reuters), Capital IQ or other platforms. Each company Watchdog Report identi es red and yellow ags, issues and other risks for the named company. A full report includes in-depth details and lists original SEC lings and source documents. Reports contain warning signs, attention ags, material disclosures, and peer analysis for use in valuation, risk analysis, due diligence research, and D&O insurance underwriting.
Gray Swan Event Factor Reports
An annual subscription to our Gray Swan Event Factor Reports costs $8,000 per year per individual subscriber (group subscription rates available). A GSEF annual subscription automatically includes a subscription to our Watchdog Reports. The GSEF is a forward looking valuation factor. It identi es the percent a stock’s price is overstated when accounting for the likelihood of a future negative accounting or disclosure event. These risks are di cult to quantify and tend to be ignored or disregarded as negligible. However, they often lead to substantial losses with each underlying stock. Before buying, selling or recommending a stock, anyone with a duciary or suitability obligation should review the stock’s Gray Swan Event Factor to quantify the stock’s potential losses for future accounting and disclosure risks. GSEF Reports are updated weekly on our website and quarterly on Factset, Re nitiv (ex Thomson Reuters), Capital IQ and other platforms. The full paid version includes detailed break-outs of contributing risk factors, with links to original source materials.
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Watchdog Research, Inc. • www.watchdogresearch.com • [email protected] • (855) 820-6272