A sound investment process and strong management team underpin iShares Core Growth Allocation ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a sizable cost advantage over competitors, priced within the cheapest fee quintile among peers.  

 The strategy's effective investment philosophy supports an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant overweight position in the Europe-Developed region and an underweight in developed markets regions compared with category peers. The strategy’s management team earns an Above Average People Pillar rating. The strategy's parent organization earns the firm an Above Average Parent Pillar rating, and this rating is inherited from vehicles belonging to the same branding entity and is indirectly assigned by an analyst.

Analyst Rating

iShares Core S&P 500 ETF

iShares Core Total USD Bond Market ETF

iShares Core MSCI International Developed Markets ETF

iShares Core MSCI Emerging Markets ETF

iShares Core International Aggregate Bond ETF

iShares Core S&P Mid-Cap ETF

iShares Core S&P Small Cap ETF

Morningstar's style-agnostic evaluation of this fund's process seeks to understand whether the strategy has a performance objective and sensible, clearly defined, repeatable execution. iShares Core Growth Allocation ETF earns an Above Average Process Pillar rating.  The most important driver of the rating is that this fund tracks an index. Historical data, like Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. The parent firm's five-year risk-adjusted success ratio of 55% also influences the rating. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median Morningstar Risk-Adjusted Return for the period. Their noteworthy success ratio suggests that the firm does well for investors and that this fund may benefit from that. Lastly, the process is limited by its parent firm's risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 3.1 stars. A lower star rating suggests that the firm has struggled to outperform on a risk-adjusted basis.

 The investment strategy as stated in the fund's prospectus is as follows: 

 The investment seeks to track the investment results of the S&P Target Risk Growth Index composed of a portfolio of underlying equity and fixed income funds intended to represent a growth allocation target risk strategy.  The fund is a fund of funds and seeks its investment objective by investing primarily in underlying funds that themselves seek investment results corresponding to their own respective underlying indexes. It generally will invest at least 80% of its assets in the component securities of its underlying index. The index measures the performance of the S&P Dow Jones Indices LLC proprietary allocation model.  

 The portfolio has allocations in its top two sectors, financial services and basic materials, that are similar to the category. The sectors with low exposure compared to category peers are healthcare and technology; however, the allocations are similar to the category. The portfolio is overweight in Developed Europe and Japan regions relative to the category average by 6.2 percentage points and 4.2 percentage points, respectively. The regions with low exposure compared to their category peers are North America and Emerging Europe, with North America underweight the average by 21.0 percentage points and Emerging Europe similar to the average.

 The fund’s fixed-income allocation maintains less interest rate risk as the fund’s average duration is 2.2 years, to the category average’s 5.1 years.

Above Average

Process

iShares Core Growth Allocation ETF benefits considerably from its allocation team, earning it an Above Average People Pillar rating. There are three managers listed on the fund: Greg Savage, Jennifer Hsui, Paul Whitehead. Experience on the team is abundant, with 18 years of average portfolio management experience. Together, they manage a total of 258 strategies, with a Silver asset-weighted average Morningstar Medalist Rating, demonstrating their potential to deliver positive alpha relative to the category median in aggregate.  

 Note: The People Pillar rating is indirectly assigned by an analyst. The longest-tenured manager of the fund also manages a different product rated by an analyst. Their analyst-assigned People Pillar rating is combined here with the People scores (algorithmic or analyst-assigned) for the fund’s other managers on a tenure-weighted basis.

People

BlackRock offers compelling options across asset classes and vehicles. It earns an Above Average rating for Parent. 
The firm’s approximately USD 8 trillion in assets under management, as of Sept. 30, 2022, gives it unparalleled scale and influence. It is a market-leading index fund provider globally, and its iShares exchange-traded fund franchise offers a low-cost lineup of core funds that investors can use to build a well-diversified portfolio for dirt cheap. The firm can be more adventurous in its ETF launches than some peers, so not everything it launches is appropriate for the masses. As a result, it is likely to have more ETF closures than peers that stick to the basic building blocks.  
The firm’s active fixed-income and multi-asset efforts also stand out as some of the best in the industry. Those benefit from BlackRock’s commitment to building a first-class risk management system via its Aladdin analytics software. The software is also available for sale to other firms and has proved to be a popular option for competitors, a testament to its usefulness. 
More recently, the firm has shifted its focus to ESG offerings and incorporating ESG across its investment lineup, leading to a political backlash in the United States.
BlackRock isn’t the best at everything it tries to do, but retail investors, financial advisors, and large institutions could all build robust portfolios using BlackRock’s products.

Parent

iShares Core Growth Allocation ETF

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iShares Core Growth Allocation ETF has a 60/40 allocation in global equities and bonds through ETFs. Exposure to foreign securities implies some currency risk, which has been detrimental since the fund's inception in 2008. Among competitors, WisdomTree U.S. Efficient Core Fund implements a 60/40 strategy with a 1.5 leveraging factor and about 98% of assets in U.S. issuers.

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The iShares Core Growth Allocation ETF is a good option for investors looking for a straightforward way to build a diversified portfolio centered on growth. AOR utilizes iShares ETFs to create a 60/40 stock/bond asset allocation strategy, which has performed well despite media coverage of its poor performance. AOR's performance has been solid since its inception, with a lower degree of price fluctuation compared to traditional equity ETFs. It is suitable for investors with a longer-term investment horizon.

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iShares Core Growth Allocation ETF ultimately has a lot of exposure to correlated monetary policies in the West that are all leaning hawkish. U.S. market returns have been driven almost exclusively by AI and the biggest of tech stocks which are exposed to hawkish policies. While inflation data will show abating figures, jobs data was strong and inflation not only has to come down but it has to do so quickly for Fed satisfaction.

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The U.S. 60/40 endured its 2nd-worst annual real loss since 1950 last year. Today, valuations are better across the global equity and fixed-income landscape, and I see AOR as a buy.

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AOR is an ETF that could easily be known by a more recognizable name. It is essentially iShares' 60/40 portfolio ETF. AOR typically holds a mix of 60% in stocks and 40% in bonds.

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The iShares Core Growth Allocation ETF (AOR) is an exchange traded fund that provides an investor with the return profile of the classic 60/40 portfolio allocation. AOR is down more than -16% in 2022, almost matching the S&P 500 performance.

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With just one share in AOR, an investor gains exposure to 20,713 different assets, including equity, fixed income, money market, and derivatives. AOR's benchmark includes both fixed-income and equity iShares ETFs, with the equity component having a 60% weight and bonds accounting for 40%.

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iShares Core Growth Allocation ETF (AOR) at a 52-Week High

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This iShares Core Growth Allocation ETF (AOR) has hit a new 52-week high. Are more gains in store?

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