Should You Invest in the iShares Expanded Tech-Software Sector ETF (IGV)?

The iShares Expanded Tech-Software Sector ETF (IGV) was launched on July 10, 2001, and is a passively managed exchange traded fund designed to offer broad exposure to the Technology - Software segment of the equity market.

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Software is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.

Index Details

The fund is sponsored by Blackrock. It has amassed assets over $14.16 billion, making it one of the largest ETFs attempting to match the performance of the Technology - Software segment of the equity market. IGV seeks to match the performance of the S&P North American Technology-Software Index before fees and expenses.

The S&P North American Expanded Technology Software Index comprises of North American equities in the software industry and select North American equities from interactive home entertainment and interactive media and services industries.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.39%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 0.02%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Information Technology sector -- about 95.8% of the portfolio.

The top 10 holdings account for about 60.13% of total assets under management.

Performance and Risk

The ETF has lost about 2.18% so far this year and is down about 2.43% in the last one year (as of 08/24/2026). In that past 52-week period, it has traded between $74.67 and $117.79.

The ETF has a beta of 1.18 and standard deviation of 25.83% for the trailing three-year period, making it a high risk choice in the space. With about 113 holdings, it effectively diversifies company-specific risk.

Alternatives

iShares Expanded Tech-Software Sector ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IGV is an excellent option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.

State Street SPDR S&P Software & Services ETF (XSW) tracks S&P Software & Services Select Industry Index and the Invesco AI and Next Gen Software ETF (IGPT) tracks STOXX WORLD AC NEXGEN SOFTWARE DEV ID. State Street SPDR S&P Software & Services ETF has $510.62 million in assets, Invesco AI and Next Gen Software ETF has $1.21 billion. XSW has an expense ratio of 0.35%, and IGPT charges 0.56%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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