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I'm focusing on iShares ETFs throughout this analysis. This way we can analyze the first half of the year while also reviewing iShares' unique history along with their strengths and weaknesses for investors in the context of today’s ETF marketplace. (This article also relies heavily on the nomenclature system of ETFdb.com, along with its data.)

iShares were launched in the beginning of 2001.  Prior to that time, the most successful ETFs had been launched by exchanges in conjunction with index providers.  This includes the S&P 500 Trust (SPY); the S&P 400 MidCap Trust (MDY); and the SPDR® Dow Jones® Industrial Average℠ ETF Trust (DIA). The emphasis was on creating trading vehicles for hedge funds and institutional investors.  They were not envisioned by their creators as alternatives to mutual funds. 

 iShares was launched to provide a one-stop shop to offer financial advisors and planners democratized access to institutional caliber index funds beyond the S&P 500.  This would include comprehensive total market index products, fixed income index products, tactical sector, and single country products, etc.   Given this vision and consistency, this first-half review focuses on capital markets ETFs through the lenses of iShares.

Here are some fast facts about iShares today:

Out of the approximately 3900 ETFs listed in the US as of June 30, 422 of them, roughly 11% , are iShares. This includes:

• 280 Equity ETFs of which 123 US only, the other 157 either international or global;
• 106 bond ETFs;
• 20 Multi-Asset ETFs;
• 6 Commodity ETVs;
• 6 Real Estate ETFs;
• 2 Cybercurrency ETFs; and
• 1 Preferred Stock ETF.

Taken altogether, this comprises $4.2 Trillion Assets Under Management, roughly 32% of the total ETF assets under management in the US.  With this backdrop, we examine how the iShares performed in the first half of 2025 from various perspectives.

Starting with the 10 largest ETFs in terms of assets under management, the landscape is captured in this table.

This list of top 10 ETFs consists of 8 Equity ETFs, 1 Bond ETF and 1 Cybercurrency ETV.  It is no surprise that IVV, iShares’ Core S&P 500 ETF, is the family’s top asset gatherer. Its $619 billion trails VOO, Vanguard’s S&P 500 ETF, by about $70 billion but still qualifies as the world’s third largest ETF behind VOO and SPY, the SPDR ETF Trust which has $755 billion. 

The top performing ETF for the first six months was IEFA, the iShares Core EAFE ETF.  Its price gain was nearly 21%, more than three times the gain of IVV.   IEFA is also the second largest iShares ETF with $142 billion in AUM.  The first six months of 2025 is one of the few periods since 2009 that international developed-market equities have outperformed US equities.  A large reason for this was the significant weakening of the dollar with respect to many major foreign currencies.  For example, the Euro appreciated 20% with respect to the dollar. IEFA also had the highest dividend yield among the top 10 equity iShares at 3.1%.   

The largest yield overall in this group belongs to the AGG, the iShares Core US Aggregate Bond ETF at 3.9%.  AGG is the third largest iShares ETF and the only bond ETF to make the top ten.

The winner in fund flows by a wide margin was IBIT, the iShares Bitcoin Trust. Gaining a net $15 Billion in flows into the fund in just six months is quite an accomplishment.  The Bitcoin Trust’s presence as #8 in total assets is rather remarkable considering that it was established only 18 months ago.  In contrast, the other ETFs on the list have been accumulating assets for more than 20 years. 

It should be noted that IBIT is an Exchange Traded Vehicle (ETV) using the “ETF wrapper” rather than a true ETF.  Most ETFs are open-end mutual funds holding securities.  Commodity, Cybercurrency and precious metal ETVs are grantor trusts.  There may be subject to different tax treatments and there could be other ramifications. 

Interestingly in a strong six months for equities, three of the iShares on this list suffered net withdrawals.  All were US equity funds, including the iShares Russell 1000 Growth ETF and two Small Cap ETFs, IWM based on the Russell 2000 Small Cap index and IJR based on the S&P Small Cap 600 Index.

Beyond the top 10, we also looked all  the iShares to determine the best performers in the first half of the year.  Here are the ten largest price gainers.

Eight of the top 10 gainers are single-country funds, benefiting significantly from the falling dollar on the first six months of 2025.  EPOL was the top performer, gaining more than 57%.  The next two highest performers were ETFs of companies that mine precious metals.  This includes RING, iShares MSCI Gold Miners ETF and SLVP, iShares MSCI Global Silver Miners ETF. The highest gain of AUM was recorded by EWG, the iShares MSCI Germany ETF.  The largest dividend yield among the top 10 gainers was EWO, the iShares MSCI Austria ETF.  It should be noted that all of these ETFs have less than $5 billion in assets under management.  Add in the fact that many hold securities that do not trade during all US trading hours, and the result is much wider bid-ask spreads than with larger US stock and bond ETFs. 

In terms of individual stocks, the top contributor to the strong performance of IEFA, the Core MSCI EAFE ETF, was BAE Systems PLC, a UK defense contractor, with a first-half price gain exceeding 400%.  The ticker symbol of its American Depository receipt is BAESY.  The top price gainer among Russell 3000 stocks was Aeva Technologies, ticker symbol, AEVA with a 283% return.  Aeva Technologies is building the next-generation of sensing and perception for autonomous vehicles and beyond.  It is based in Mountainview, CA.  The company is currently rated 3 (Hold) by ValuEngine.  It is forecast for a healthy 16% earnings gain but is highly overvalued according to our valuation model. 

The top S&P 500 performer was Palantir Technologies, PLTR, The California-based artificial intelligence software platform stock gained more than 100% during this period. It is currently rated 4 (Buy) by ValuEngine. It also has a very rich valuation according to our valuation model.

In summary, the first half of 2025 saw very volatile equity, fixed income, precious metal, and cryptocurrency markets but by June 30, most market-leading ETFs righted themselves and registered gains for the periods.  As usual, there were some niche exceptions. 

What does all this mean for the second half of the year?  Generally, there are very few conclusions to be drawn.  Value-oriented hedge funds sometimes look at the largest gainers as potential shorts looking for mean reversion, especially among recent gainers in danger of missing increased earnings expectations.  Most studies on this theory have concluded that mean reversion is a valid concept but knowing the point of the eventual downturn for a stock currently on a steep upward trajectory is nearly impossible.  To the extent that positive trends continue until they don’t, shorting such stocks too early can be very expensive.  At ValuEngine, we prefer a more systematic, stochastic and complex multivariate approach.  That said, it is always useful to quantify recent performance  for a greater understanding of the current ecosystem. 

That said, the strongest trend that shaped the outperformance of non-US ETFs and stocks over their US counterparts in dollar-denominated terms was the weakness of the dollar relative to other currencies.  Given the uncertainties surrounding US policy changes and their global effects, most currency experts see a rebound for the dollar unlikely during the next six months.

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